MrsMac and I talk with our financial adviser several times a year via phone, skype and email however I love the 2-3 hour long 1:1 meeting we have with her once a year. Well we had our 2+ hour chat this past Tuesday. True to form there was a lot exchanged by both parties. True to form, my left leg is bruised from MrsMac hitting it during our meeting.
First I must write that we LOVE our FA and have a lot of respect for her. We have been together for ~20 years and now she is the President of the firm.
I will skip the boring part where we talk about our portfolio and go right to the meat of this post - What is ahead for our economy according to our FA.
These are some of her predictions:1) Stock market correction of -15%. So a drop down to ~15,000 DJIA. (a)
2) Bond market taking a dive.
3) Interest rates not going up at 25bpnts a quarter but a large jump of maybe 1 point. She explained that this was
needed so that QEing could be slowed. I forget the reasoning when I questioned her on this point.
4) PM's (Precious metals) climbing, not to 2011-12 prices; maybe a 20% jump especially in the silver market.
5) She is NOW recommending that all clients of the firm, have ready cash
on hand. Min recommendation of four
weeks outlay of cash, e.g. mortgage payments, credit card payments, food, heat/light, etc. (b)
6) The countries (USA) economy is on the upswing and we will see a distinct improvement in 12-18 months. (c)
7) She predicts that Q2 GDP will be around 2%. Then north of that number by as much as 100 Bpnts in Q3 & 4. (d)
8- She predicted that there would be another agreement between Greece and the EU. I asked her if the Fed will have
any part of that new agreement? Her response was something like this, "Even if Greece does leave the EU, it will not
affect us here in the US." (e)
My Comments: a) I think it will be closer to 20%
b) Three years ago when I told her we were doing this, she thought I was a wacko. "Why endanger your family by having
cash on hand" she countered with. Now she is making this suggestion to the firms clients.
c) This annoyed me so I challenged her assertion. What I got was a pre-rehearsed speech outlining the U-3 employment
rate, low gas prices, height of the stock and bond market. I countered with U-6 employment, inflation of food and
her earlier prediction of the correction within the market. We finally both agreed that our economy was "anemic".
d) I told her that it would most likely be .5% with a +/- .5% swing. She nervously chuckled and we made a lunch bet
on who's prediction would be closer.
e) Bullshit! (Excuse my French). Once Greece leaves the EU, the domino effects will be seen. Spain/Portugal and Italy
come to mind.
Anyway, these were the highlights of the two hour meeting. There was some other things I have forgotten but will remember and later post.
I also want to share that she had as many questions for me as I had for her on my predictions. Many of my answers she challenged as I did hers. This meeting, she also had an assistant sit in which I had no problems with. She pretty much kept her mouth closed but kept A LOT of notes.
In closing, PLEASE understand that we love and respect our FA. Our portfolio is solid and making money which I accredit her and the firm for. She as I, love our exchanges. On the other hand MrsMac hates it.
So what are some of your predictions for the second half of 2015?
