09.06.2022 Views

Spring 2022 Newsletter

In this Spring 2022 Newsletter, learn some valueable information to help navigate through an era of inflation and other market worries.

In this Spring 2022 Newsletter, learn some valueable information to help navigate through an era of inflation and other market worries.

SHOW MORE
SHOW LESS

Create successful ePaper yourself

Turn your PDF publications into a flip-book with our unique Google optimized e-Paper software.

Strategic Planning Group 1


C O N T E N T S

Ryan Craner

shares some

great strategies

to consider. pg. 3 - 5

pg. 3

Lions, Tigers, Bears, Oh My!

Inflation, The Fed, Recession, Oh My!

by Ryan Craner

Ryan shares some important insights and

reminders regarding the market concerns.

pg. 6

Be Greedy When Others Are Fearful

by John Park

John recommends some helpful strategies

as fear of events encompasses us.

pg. 8

In Hindsight:

Let History Be Your Guide

by Tom Craner

Tom takes us through a decade of events as

we try to navigate towards long-term goals.

pg. 10

Are We Recklessly Optimistic?

by Alex Craner

Alex helps us recognize that downturns are

a part of the volatility an investor must bear

to earn stock market returns.

pg. 13

Banana Bread Recipe

by Heather Cunningham

Enjoy one of Heather's favorite recipes.

pg. 3

Lions, Tigers, Bears, Oh My!

Inflation, The Fed, Recession, Oh My!

pg. 14

Meet the Team

Introducing the new members of the office.

Strategic Planning Group 2


Lions, Tigers, Bears, Oh My!

Inflation, The Fed, Recession, Oh My!

By Ryan Craner

Taking the client advocate and consumer protection approach, Ryan has always viewed every

client as a long-term and very important relationship.

The fearmongers in the media

are out in numbers and they

want you to be afraid, very afraid!

I will remind you that much

of the fear being promoted

is overstated. Just like the

Lion’s, Tiger’s, and Bear’s

fearful chant from the Wizard

of Oz was overstated as well.

Remember that Dorothy and

company only saw a Cowardly

Lion, no Tigers, or Bears!

Recently, we have seen numerous

reports that at first blush are

worrisome and concerning

regarding the economy and the

markets. Of course, and as usual,

the “chicken little” financial

media and traditional media

report these events in the darkest

terms possible. Dramatizing and

fearmongering the events that

we knew already existed or we

already knew they were coming.

In the last several weeks we

have heard that the economy

measured by GDP had slowed

in the first quarter of 2022.

We also saw the inflation rate

increase to 8.5%. Also expected.

The first week of May we saw the

Fed raising interest rates by .5%

(as expected and announced).

The media runs to the

microphones and reports these

facts as if it were a total shock to

everyone! Well, no, the markets

have had these events already

factored in. We knew rates were

going up. The Fed chairman

and the board members have

been announcing and telling

us this for months. Inflation has

been on the rise and predicted

to be higher for months.

The fearmongers

in the media are

out in numbers and

they want you to be

afraid, very afraid!

Strategic Planning Group 3


It will very likely go higher still

before it comes back down to

tolerable levels. We know that

based on history. Although,

it has been 40 years since we

last saw inflation like this, 1979

through 1982. Somehow that is

a reason to be more afraid and

overreact to inflation because

“this is the highest inflation rate

we have seen in over 40 years!!!”

Well, actually, that is normal!

Would you care to guess when

the inflation rate increased

dramatically before the 1979-82

high inflation period? Yep, you

guessed it. It was 35-40 years

before that in the mid-1940s,

and before that? Yep, you’re

right again, 35 years before that

Recessions are

normal and common

place in long-term

economic history.

in the early 1900’s. So every

35-40 years the economy goes

through an inflationary period,

historically for only 3 years or

so, and yes, we can expect more

inflation in the coming year or

two and more interest rate

increases from the Fed. These will

not be surprises or unexpected.

Also, something that is important

to note, is that following these

periods of high inflation, we

have seen massive big bull

market green zones. For example,

following the early 1900’s inflation,

we saw the roaring 20’s. After

the mid-1940’s inflation, we

saw the huge green zone of

the 50’s and 60’s and following

the inflationary period of ’79-

’81, we saw the go-go green

zone of the 80’s and 90’s.

The seeds of market recovery

are being planted this week.

Another important factor to

consider is that we have 73

million millennials in the U.S.

alone who are practically

forced into buying stocks

for the next several decades.

Watching the market over the

last year or so, we are seeing

the typical patterns, and we

are seeing the typical investor

behavior. The markets are, as

usual, assuming and factoring

in inflation, rate increases, and

yes, even a recession. Very

important to remember on

recession! Recessions are normal

and common place in long-term

economic history. Recessions are

usually small and short lived. I see

people assume that when they

hear the word recession, that it

means we are looking at 2008

again! This is not historically true.

Most recessions are small and

short lived, and again, common

place through years, even during

green zones like the 80’s and

the 90’s and the 50’s and 60’s.

Don’t overreact to recession talk.

Expansions

and

contractions

are

Normal!

Historically, low

points have never

lasted long. V

Shaped market

recoveries are

most common.

Long-term discipline

and behavior has

always worked best.

This means calm,

rational, thoughtful

behavior is the best

course.

REMINDERS

Strategic Planning Group 4


Now, I mentioned investor

behavior. Bad and inaccurate,

predictable investor behavior

is occurring as well. We see

people, in general, tempted to

sell low, and worse, suspend

or delay new investments or

buy ins to their investment and

retirement accounts until the

market is higher. Most all of

our clients are wiser than that.

However, sometimes you just

need to be reassured. This article

is part of that reassurance,

and, of course, if you wish to

talk further, myself and each

of the advisors at Strategic

Planning Group are available

and more than happy to talk

with you. That is part of our job.

It should be noted that many

of the economists and market

analysts that we follow are

still predicting a better end to

2022 than the first half of 2022.

There are still many positive

economic catalysts in front of

us, namely the lack of severe

COVID policy and shutdowns,

the low likelihood of any new tax

increases, and the continued,

very large, influx and importing

of capital coming into the U.S.

each year as a result of the Tax

Cuts and Jobs act of 2017 (TTJA).

Reminders About

Investment Markets

and the Economy:

1. Expansions and contractions

are normal!

2. Historically, low points have

never lasted long. V shaped

market recoveries are most

common.

3. Long-term discipline and

behavior has always worked

best. This means calm, rational,

thoughtful behavior is the best

course.

Things to Consider Now:

If you have had money to invest

but hesitated and watched markets

go up substantially without you, this

is a great time to buy. We believe that

current conditions are presenting

tremendous buying opportunities

and tax opportunities.

Strategies to Consider:

1. If you have an annual

withdrawal coming up soon, it

could be wise to delay that until

later this year if possible.

2. If you are taking income out

that is really not necessary at

this time, delay or suspend it for

a short time.

3. If you are planning to buy in

or contribute money to your

investments and retirement

accounts this year, this would

be a great week to do that.

4. For those of you that have

considered converting all or a

portion of your traditional IRA

or 401k to a Roth, this could be

an excellent opportunity to do

that at a substantial tax savings

while markets are lower.

5. If you have friends, family, or

co-workers that you have talked

to about coming to see us, and

it just hasn’t happened yet,

this week is a perfect time for

them to call and get the process

started. These opportunities

may not last.

In Conclusion

So, once again, the message

from me and your advisors at

Strategic Planning Group is that:

We are not afraid. We are not

worried about the long-term

results. We are invested, ourselves,

in the very same portfolios that

you hold. We are very confident

that we will soon emerge from

this period of uncertainty.

A reminder to you all,

limit your media and news

intake, you will feel better.

Also remember, live your life, enjoy

your family, friends, and your

favorite activities and hobbies.

Life is good and these are

the good years! Keep that

attitude because it’s true!

We are watching. We are hard at

work managing your investments.

History shows that we are

positioned for long-term success!

Sources:

CPI Home : U.S. Bureau of Labor Statistics (bls.gov) – All Items (inflation)

https://www.ftportfolios.com/Blogs/EconBlog/2022/5/4/jerome-volcker

https://www.ftportfolios.com/Blogs/EconBlog/2022/4/28/real-gdp-declined-at-a-1.4percent-annual-rate-in-q1

https://www.benzinga.com/trading-ideas/21/03/20195933/cnbc-contributor-josh-brown-says-millennials-are-forced-investors-says-theres-no-reason-theydwant-

Strategic Planning Group 5


Be Greedy When Others

Are Fearful

By John Park

From investments to complicated retirement strategies, John works to educate and advice his

clients on making smart financial decisions.

Among many great quotable

statements, one of my favorites

from Warren Buffet is to be “fearful

when others are greedy, and

greedy when others are fearful.”

The second part of that quote

is what truly separates good

investors from bad.

When the markets are down and we

face uncertainty in the economy,

it’s easy to be fearful and pessimistic.

Since it is so easy, being negative

tends to come naturally.

True optimism, on the other hand,

requires you to act; assessing a

situation, realizing all is not lost,

and forging a path forward to

prosperity.

While we want to be positive and

focus-forward, it is still important

to be honest about current events.

Let us talk about the negative

for a moment, then we will

talk about an action plan and

positive strategy.

When I wrote my last newsletter

article, I quoted inflation as being

5.4%. It is now 8.54%. Supply

chain shortages continue to strain

our economy. Russia invaded

Ukraine. The S&P 500 is -11.48%

YTD. The NASDAQ is down

-19.26% YTD. COVID version “X”

is cropping up. Need I go on?

You get the picture. There is no

shortage of negative news.

Here is what I recommend

going forward: 1) Be smart with

your existing investments. 2)

Take advantage of downside

strategies.

Be Smart with Your

Existing Investments:

Stocks, bonds, mutual funds,

and exchange traded funds are

assets. They are real, monetary

instruments and assets. Do not

be reckless with them. Simply

put, do not sell them when they

are down. I cannot emphasize

that enough. It sounds so simple,

but the best advice often is.

Admittedly, simple does not always

mean easy, and in most cases, is

much harder to practice.

Maybe a different perspective

will help you not be tempted

to dump important investment

assets when they are down.

When you hold a certain number

of shares in an investment, the

decrease of market value does

not evaporate your shares. You

still own the same number of

those assets. Let’s say you own

1,000 shares of Amazon

(congratulations if you do) and

the stock absolutely tanks.

You will not be happy with the

value of your investment, but

you will still own 1,000 shares

of Amazon. Why on earth would

you dump it? You have witnessed

firsthand what that stock can do.

Do not panic and “sell while you

still can.” Whether you are in

a specific stock, or diversified

portfolio spread across thousands

of stocks (via funds), the concept

is the same: you still own those

specific shares.

In my mind, selling stocks while

they are down, is the same as

selling your home because its

value dropped. If your home

value drops, are you going to

sell your home, go rent a place,

and buy again once prices go

back up? Of course not! Yet,

people try this all the time when

the stock market is down.

Some people incorrectly view

the stock market as gambling. If

it starts dropping, they think it

is only a matter of time before

they lose it all. Proper stock

market investing is the literal,

statistical, opposite of gambling.

It is a fact when you gamble in

Vegas, the longer you are in the

casino, the more likely you will

lose your money. This is because

the house has the better odds

and why, in a casino, everything

is designed to keep you in your

seat.

In a properly diversified, longhold

strategy market portfolio,

the longer you invest, the more

Strategic Planning Group 6


certain you are of a gain. For the

record, I am not talking about

a minimum of 20 or 30 years.

The fact is, there are far more

positive years in the markets

than negative. For example,

since the inception of the S&P

500 Index in 1957, there have

been 17 negative years in the

market, 1 zero, and 47 positives.

That is a positive to negative

ratio of 2.76:1. In other words,

for every negative year, there

are almost three positive years!

When you see the resilient and

impressive nature of the stock

market, it is easy to realize you

should hold on to those assets

and be greedy over them. Do

not sell them to someone else

for less than you paid.

Take Advantage of

Downside Strategies:

Let’s talk about smart strategies

you should be employing RIGHT

NOW.

BONDS

As your advisory team, we

automatically deploy certain

strategies for you. One strategy

that we use, we will have started

years before clients even retire.

If you are retired and utilizing

your investments for income

generation, we have kept you

in a healthy amount of bonds

or other fixed income assets to

protect your income. The right

kinds of bonds will help offset

the volatility of stocks and, more

importantly, give you a place

to pull income from during

negative stock periods. This is

a perfect example of not selling

stocks or stock funds while they

are down.

Starting in January this year,

we changed our client’s income

distributions to primarily pull

from fixed income investments

to do that until stocks recover.

This is a crucial step to protect

your stock market assets. That

is our part. Your part is to avoid

unnecessary large withdrawals

or panic selling.

In June of 2021, we felt the

Fed was being too soft on

inflation and not properly

increasing interest rates. We

figured procrastinating interest

rate increases would mean

they would have to get more

aggressive later. Unfortunately,

we were right. Fortunately, in June

we started moving into short

duration and other bond positions

that are more defensive to

inflation and rising rates.

MARKET MOVEMENT

Also, in January of this year, we

moved a few aggressive stock

funds into more conservative/

defensive positions. Although

none of these were drastic steps

like selling into cash, they have

and will likely continue to make a

significant difference over time.

More often than not, making

huge swings in and out of the

market is more detrimental

than market drops. You are

not psychic, so do not try to

be with market movements.

Simply riding through the

storm, holding firm to strategies,

and exercising diligence is the

tougher but better approach. In

short, we do not make drastic,

bold moves in and out of the

market; however, we do actively

adjust our models within certain

reason and strategy.

BUY

The next smart strategy to

employ during this time is to

BUY, BUY, BUY. Stocks are on sale

right now. Be greedy and gobble

them up. We always insist you

keep proper cash reserves and

emergency savings. Beyond

that, if you have excessive liquid

funds, now would be a smart

time to buy. If you are preor

IRA contributions. Better yet,

increase your contributions. Be

greedy.

If you are retired, not contributing,

or can’t afford to contribute

any more, do not worry. Your

investments are buying on the

dips for you. What I mean by this

is that you have many investment

positions still paying dividends.

Despite their stock prices

being down, many companies

are still profitable and paying

shareholders dividends.

Take a look at your monthly

statements so far this year.

You will see many line-item

transactions for varying dollar

amounts of dividends paying into

your account. We typically have

these dividends set to reinvest

automatically. This means if “X”

mutual fund pays you a $100

dividend, it automatically buys

for you $100 more of that same

fund.

This is what we call compounding

dividends, and it is massively

powerful. In this scenario, not

only do you have the same

number of shares before the

dip began, but you also gain

more if you reinvest dividends.

This will act as a compounding

growth factor as things recover.

Congratulations, you were

greedy and gained more shares

while prices were down.

STAY INVESTED

I urge you to stay invested. Do

not panic when things decline.

Market dips are temporary, they

always have been and always

will be, perhaps until the world

ends. Hopefully if that ever

happens, you and I are onto

bigger, better things! In all

seriousness, in the markets and life,

those who remain optimistic,

stay diligent, and follow a plan

tend to fare far better than those

who are pessimistic and panic.

Sources on page 8

Strategic Planning Group 7


In Hindsight:

Let History Be Your Guide

By Tom Craner

Tom engages in life-long client-advisor relationships, utilizing long-tested financial strategies

that are focused on consumer protection.

There has been recent tumult

in the markets, and I am

sure you have noticed. We are

hearing reports of “runaway

inflation” and “a 2008 style

recession.” Nevermind the fact that

predictions of these events are

more common than dandelions

in the springtime.

Remember all the times and

events that caused panic and

fear? Let’s take this opportunity

to go over the biggest stories of

the past 10 years and see why

we should be confident, despite

the similar fearmongering

headlines we see today. We can

ask ourselves if our collectively

short memory is causing us

to relive the same negative

emotional state regarding our

investments that we have seen

before.

A DECADE IN REVIEW

2011

We hit the debt ceiling, saw

“Occupy Wall Street” protests

erupt, witnessed the Greek

economy collapse, and for the

first time in history the S&P

downgraded U.S. debt.

2012

We approached what the

fearmongers called the “Fiscal

Cliff.”

2013

The IRS overreached and was

proven to have engaged in audit

malpractice, Detroit declared

bankruptcy, and there was a

federal government shutdown.

2014

We lived through the Ebola

epidemic, saw fighting in

Ukraine, and Russia’s annexation

of Crimea despite world-wide

condemnation, the Israel-Hamas

conflict began, we saw the rise

of ISIS, and a major migrant crisis

consisting of unaccompanied

minors took place on the

southern border.

2015

The Greek economy was bailed

out, and the IRS was hacked by a

Russian crime syndicate.

2016

We saw Great Britain finally

leave the EU (Brexit), and the Fed

increased rates in the U.S.

2017

Despite the first major tax cuts

passed in decades, the Fed

increased rates even further.

2018

We witnessed an intra-year

market correction of over 20%

in December, we began a trade

war with China, unemployment

fell to a 49-year low, the Fed

increased rates yet again, and

we saw many headlines about a

“global economic slowdown.”

2019

The yield curve inverted, the

Fed lowered rates, the federal

government shutdown again,

and COVID-19 began spreading

in China.

2020

The people in Hong Kong

protested for their independence,

and unfortunately lost, while

COVID-19 became pandemic,

followed by a 34% market

correction in March and April,

Black Lives Matter rioted in cities

throughtout the summer

resulting in billions in damages

and dozens dead, a record

earthquake hit Utah, and to

top it off, the murder hornets

invaded.

2021

We saw the January 6th protests,

abrupt military withdrawal from

Afghanistan and subsequent

Taliban takeover, more COVID-19

variants, and inflation at its

highest since 1990.

Strategic Planning Group 8


Hearing all of that at once might

cause one to think that we just

lived through the end of the

world. If, in 2011, I came to you

and showed you everything I

just mentioned using a crystal

ball, would you decide to invest

in the stock market? I doubt it!

Well, here is the kicker: during

that same period (2011-2021)

the S&P 500 grew from 1,271

points to 4,766 points. Almost

quadrupling in value!

The point is this: The headlines

from the fearmongering news

media will always be scary.

International and domestic

financial, economic, and political

events will always feel absolutely

important at the time they

happen. The emotional reactions

we have to these events will

always feel reasonable.

Strategic Planning Group once

again asks our clients to

remember their past. For all the

market’s history, there has never

been a market drop or recession

that we have not recovered from

(and subsequently broken new

records). There has also never

been an apocalypse or a societal

collapse despite the constant

predictions by various pundits

and commentators. We can

always find a reason to fear the

future and stay stuck in the past.

As always, our advice is to

remember the basics and stick to

the plan. Liquidity, diversification,

and most importantly, forward

thinking. Do not let current news

cycles and fearmongering pull

you away from the path that has

prevailed successfully through

the decades. Stay optimistic and

with thoughts towards the longterm,

and do not forget to enjoy

the wild ride of life.

https://infoplease.com/search/Year+in+review?page=1

https://www.telegram.com/story/business/manufacturing/2011/06/17/stocks-on-track-for-first/49996614007/

https://www.macrotrends.net/2324/sp-500-historical-chart-data

John’s Sources:

https://ycharts.com/indicators/us_inflation_rate#:~:text=US%20Inflation%20Rate%20is%20at,month%20and%202.62%25%20last%20year

https://finance.yahoo.com/

https://www.macrotrends.net/2526/sp-500-historical-annual-returns

Strategic Planning Group 9


Are We Recklessly Optimistic?

By Alex Craner

Comprehensive counseling with achievable and time-based goal setting for retirement and

estate planning, without secrets or short-cuts, are ingrained features of Alex’s services.

Since the beginning of 2022,

we have had to endure a

significant double-digit market

downturn. This has, unsurprisingly,

created a lot of worry and

doubt in many of our clients.

It is important to us that we

are never cavalier about the

emotions of our clients because

we understand that these

market lows can feel painful

in the moment; however, it is

crucial to recognize that these

downturns are part and parcel

of the volatility an investor

must bear to earn stock market

returns.

One might respond to this

by thinking, “Of course I

understand this, but a doubledigit

downturn seems pretty

extreme.” While it may seem

extreme, downturns of this

size are not only common,

but historically, they are quite

frequent. So frequent, in fact,

that since 1980 there has been

an average intra-year market

downturn of -14%. Despite that

being the case, 32 of the last 42

calendar years were positive.

This trend can be observed in

the below graph. The red dots

indicate the point during each

calendar year since 1980 where

the stock market was at its

lowest point, while the gray bars

display the ending market return

for each year.

Strategic Planning Group 10


This is all to say that what we

have been experiencing so far

in 2022 is not only normal, but

somewhat expected. That does

not mean that it is easy to be

optimistic through a market

scenario like this one. Shorterterm

market activity tends to

dominate the focus on news

media and market pundits.

Yet, such a short-term focus

is rarely useful to our clients,

and investors more broadly,

who typically have long-term

goals with timeframes that are

measured in years, not months

or quarters.

Drawdowns are a natural

component of stock market

investing and volatility risk

comes with reward. Tolerance

to volatility involves proactive

(rather than reactive) decisions

through proper and prudent

diversification. This is a primary

focus of ours when developing

portfolios that make volatility

more easily endured. Your ability

to prevail through volatility will

directly impact your ability to

compete against inflation and

an increasing cost of living.

In our view, no matter where

The key to a

successful investment

experience is

refraining from

emotional reactions.

you stand on the suitability

spectrum, the key to a successful

investment experience is refraining

from emotional reactions to

short-term noise and keeping

your mindset in line with your

long-term goals and objectives.

Source: FactSet, Standard & Poor’s, J.P. Morgan Asset Management

National Expertise

Home Town Values

Experience - Reputation - Results

With founding principles of written strategic plans going back decades, Strategic Planning Group

brings together all the disciplines that a sophisticated client needs:

Tax strategy/accounting, legal/estate strategy, investment management strategy, retirement strategy

Strategic Planning Group 11


Complimentary

Retirement

Analysis

RETIREMENT PLANNING SPECIALISTS

190 South Main Street

Bountiful, UT 84010

801-627-2200

Call to schedule your

analysis today.

www.StrategicUtah.com

Retirement Lifestyle Planning

Investment Management

Consumer Education

Advisory services are offered through Strategic Planning Group,

Strategic Planning Group Registered 12 Investment Advisor with the SEC.


Banana Bread

By Heather Cunningham

Ingredients:

3 or 4 ripe bananas, smashed

1/3 cup melted coconut oil

1 cup coconut sugar (can reduce to 3/4 cup)

1 egg, beaten

1 tsp baking soda

Pinch of salt

1 1/2 cup gluten free flour

Optional: Chopped pecans or walnuts

1 tsp vanilla

Directions:

Preheat oven to 350°F.

With a spoon, mix the coconut oil with the smashed bananas in a large mixing bowl.

Add in the sugar, egg, and vanilla. Next, add in baking soda and salt. Mix.

Add flour last, mix. If using optional ingredients, add in the amount you desire now.

Pour the mixture into a coconut oiled 4x8 loaf pan. Bake for 1 hour. Cool on a wire rack.

*Can substitute butter for coconut oil, sugar for coconut sugar, and flour for gluten free flour

Strategic Planning Group 13


MEET THE TEAM

The people of Strategic Planning Group work closely as a team to foster an unambiguous and clear

path forward. Our team is integral to ensuring that our principles towards investment planning and

management of your estate are effectively implemented. You can trust that the combined decades

of experience shared by our advisors will always be utilized by our staff to ensure success in your

Strategic Plan.

R Y A N C R A N E R

President & CEO

Ryan founded Strategic Planning Group to help consumers avoid

piecemeal planning and simply buying products and instead

create an all-inclusive written Strategic Plan. A Strategic Plan

is to your financial life what a blueprint is to building a home.

This custom approach, which began as a simple idea, has grown

Strategic Planning Group into a trusted and established firm.

JOHN PARK

Wealth

Management

Advisor

TOM CRANER

Wealth

Management

Advisor

ALEX CRANER

Wealth

Management

Advisor

JEFF DRAPER

Chief

Compliance

Officer

Strategic Planning Group 14


HEATHER CUNNINGHAM

Communications Director

KELSIE DAYTON

Client Services Representative

ANGELEAH JENSEN

Operations Specialist

MARIBEL ORTIZ

Client Services Representative

FRAN PAXTON

Client Services Representative

BECKY PARK

Client Services Representative

AMY DEITSCH

Client Services Representative

CORINNE PARK

Client Services Representative

“Great things in

business are never

done by one person.

They’re done by a

team of people.”

MORGAN SEPULVEDA

Client Services Representative

ALLIE CRANER

Client Services Representative

RISA BAKER

Client Services Representative

-Steve Jobs

Strategic Planning Group 15


Strategic Planning Group 16

Retirement Planning Specialists

Hooray! Your file is uploaded and ready to be published.

Saved successfully!

Ooh no, something went wrong!