The World Series is here! Which is great because I needed another reason to stay up late. Just kidding – I’m exhausted.

As a life-long Atlanta Braves fan this one is particularly sweet. At the All-Star Break, the Braves were below a .500 winning percentage and then suffered the loss of two of their top bats (Acuna and Ozuna). A few savvy replacement moves by the front office and somehow this team started winning eventually taking the division, beating the Brewers and Dodgers and advancing to the WS.

I Collect Cash Flows

I Collect Cashflows

In today’s frothy market, people are more interested in prices, charts and unrealized gains.

In the long-run it’s what you fundamentally own that matters. Josh Brown has a fun summary.

The Future Is Female

Female Advisors: Five Reasons Why They’re A Better Fit Than Ever.Women are the breadwinners in more and more households. Better servicing this demographic is an important business decision for advisors.

Most of the author’s points involve women exhibiting better empathy & situational awareness.

“Wouldn’t a woman be better suited to listen to another woman about her deep fears and uncertainty and the implications on her financial life?”

“A recent CBC News article “Broken Marriages Becoming Pandemic’s Other Toll” quoted financial literacy and credit counsellor Pamela George: “Pre-COVID, I would work with couples to help them figure out their finances together,” said George. “Now, 80 per cent of my clientele are women who are looking to leave a troubled marriage, or women who have just left and need help to figure out their finances.” Wouldn’t a woman prefer to have this type of discussion with a female adviser?”

Retiring Early

Retiring Early Is Looking Easier. Here’s How to Do It With No Regrets.From last week’s Barron’s. If you don’t have a subscription I apologize – I don’t have the permission to distribute. Some notes summarizing below.

We’ve spent some time reading up on what exactly is driving the labor shortages. Rising labor costs will feed through to inflation over time. Previously, we found that disruption to child-care seems to be one component that lowers Labor Force Participation but this doesn’t appear to explain a large portion of the shortage today. Instead, it looks like early retirements are a key driver of the current labor shortage.

  • The pandemic accelerated retirement for many Baby Boomers.
    • Per St Louis Fed, there were 3 million excess retirements during the pandemic. If the numbers are correct, this explains effectively all of the short-fall in the labor force.
      • Said differently, “There was an 8% decline in the labor force participation rate for those 65 and older from Feb 2020 to Sept 2021”
    • Okay… I can see how pulling 3 mil. individuals out of the labor force lines up nicely with the current labor shortage (below). What doesn’t make sense to me is that the jobs Baby Boomers left for retirement do not line-up with the labor roles that are going unfilled (restaurants, child-care, etc). Either our labor force is so incredibly flexible and mobile that as the retiring Baby Boomers moved out, everyone moved-up a rung on the career ladder OR there is something else going on in this labor market… we will keep digging into this issue.

Civilian Labor

  • From an advisor perspective, there are several concerns to keep in mind regarding Baby Boomers
    • Retirement accounts have benefited from the extended bull market so clients are optimistic. Of course, a sell-off can happen at any time so people should factor in an adequate margin of safety.
    • Expenses are skewed downwards due to the pandemic/travel lockdowns. This could be leading people to forecast spending less than they actually will and give a false sense of security about whether they can afford retirement.
    • Inflation is accelerating and could seriously harm retirement plans. Most bonds represent a negative real rate-of-return. Rising expenses on a fixed income are not a recipe for success.
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