Plan, Grow & Create Wealth

26/01/2023

Life is unpredictable, but you can ensure your loved ones are taken care of even in the worst case scenario. Life insurance is not only a way to protect your family's financial future, but also a way to give them peace of mind.

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07/11/2022

Last Week's Recap:

A 0.75% rate hike was announced last week by the Federal Reserve. Currently, the short-term borrowing rate is between 3.75% and 4%, the highest level since January 2008. Locally, The CBUAE has raised its Base Rate from 3.15% to 3.90%.

This is the fourth consecutive 75-basis-point increase by the Fed. It stated that it will continue to increase the target rate.

24/10/2022

It is considered a bear market when the market drops more than 20% and continues to fall for a sustained period of time.

The following is a look at some of the history of recent bear markets:

Back in 2020, the bear lasted only 33 days.
The biggest bear for 929 days (2000- 2002).
The current bear has been around for 288 days.
The average bear lasts 388 days.

About 3 months remain until the current bear market reaches its average. Is that a sign that it's nearly over? Nobody knows! Most importantly, make sure you stick to your long-term investment goals!!

03/10/2022

Most of 2022 has been characterized by wild stock market swings, with tech stocks feeling the most heat. The Nasdaq (which is mainly made up of tech stocks) is in a downward trend. During the past two weeks, it has been at its worst since the pandemic began.

Last week, Google and Microsoft both hit 52-week lows. The price of Meta, aka Facebook, is at its lowest level since early 2019. In the S&P 500, Meta (META -0.54%) is one of the worst performers. So far, it has dropped nearly 60% in 2022.

A flight to more defensive assets has crushed tech stocks as investors exit growth stocks. Inflation, higher interest rates, and a possible recession have all contributed to the popularity of this trend.

28/09/2022

S&P 500 hit a new low in 2022!

The S&P 500 has fallen -24.7% since January. There has been a decline of 21.4% in the Dow since its all-time high, while the Nasdaq has fallen by -33% since its November high.

The market isn't doing well, what's wrong? Fed rate hikes are causing investors to worry that the economy will enter a recession. Additionally, there are a few (major) concerns such as the war in Ukraine, the problems with European energy and currency, and sky-high inflation.

26/09/2022

Currency weakness against the Dollar is expected to cause volatility on stock exchanges around the world. A record low for the pound was reached when sterling fell 4.7% against the dollar to $1.035.

Kwasi Kwarteng, Britain's new finance minister, unveiled historic tax cuts and massive borrowing increases on Friday, which sent sterling and British government bonds into freefall.

Sterling isn't the only currency to take a hit. The currencies of Japan, South Korea, and China weakened against the dollar in the Asia-Pacific region. Fed policy is raising interest rates aggressively, which has led to a strong rise in the U.S. Dollar index.

22/09/2022

Another major interest rate policy decision was made by the Fed.

The Fed's conference highlights the following points:

-0.75% was added to the benchmark interest rate by the Fed.
-Rates will continue to rise above current levels.
-Currently, the federal funds rate is between 3% and 3.25%.
-It is expected that the Fed will reach an "endpoint" of 4.6% by 2023.
-Inflation is expected to fall to 5.4% this year, according to the government.

Immediately following the news, stocks plummeted and Treasury yields vaulted to their highest levels since 2007. The 2-year yield hit 4.1%.

20/09/2022

A major announcement is expected this week, which investors are preparing to digest. Today's Fed meeting will determine tomorrow's interest rates.

The Federal Reserve is expected to increase interest rates 75 basis points. Some Wall street analysts, however, believe that a more aggressive hike of 100 basis points is possible.

The market is likely to be shocked if the Fed raises rates by 100 basis points because it would imply that the Fed is not confident in its own timetable for cooling inflation.

19/09/2022

There are five main benefits to investing:

Investing builds wealth.
Investing helps with retirement.
Investing helps you reach long-term goals.
Investing comes with tax benefits.
Investing keeps investors ahead of inflation.

16/09/2022

This week, mortgage rates rose above 6% in the U.S, the highest rate since 2008. Last year's 30-year rate was 2.86%, but this year's was 6.02%, a significant increase. While interest rates started out the year at 3.11%, inflation and recession fears consistently pushed them upward.

Sales are low when rates are high. Since last September, the number of home applications has plummeted over 80%.

15/09/2022

https://www.nytimes.com/live/2022/09/13/business/inflation-cpi-report/inflation-came-in-faster-than-expected-in-august-even-as-gas-prices-fell?smid=url-share

Despite market expectations of 8.1%, the annual US inflation rate eased for a second straight month in August of 2022 to 8.3%, the lowest in four months.

The stock market plunged on Tuesday after the inflation report. A drop of almost 4% in the Dow Jones Industrial Average was the worst since June 2020, resulting in a loss of more than 1,200 points. In contrast, the S&P 500 - the index to which many 401(k)s are tied - dropped more than 4%, its worst day of the year. Over 5% of the Nasdaq's value was lost.

Overall inflation in the United States moderated less than anticipated in August and an index that strips out food and fuel picked back up, bad news for policymakers.

13/09/2022

To combat red-hot inflation, the ECB raised interest rates for a second consecutive time. Last Thursday, the European Central Bank increased its benchmark deposit rate by 75 basis points to 0.75 percent.

Inflation expectations have been revised up to 8.1% in 2022, 5.5% in 2023, and 2.3% in 2024, respectively.