Marc Werkmeister

Managing Member and CFP at PFA. Helping individuals and business with retirement solutions. #financialplanning #investing #CFP

[Meb Faber @MebFaber]

USA Investing Quote of the Day: “Far more money has been lost by investors preparing for corrections or trying to anticipate corrections than has been lost in corrections themselves.” - Peter Lynch

[Meb Faber @MebFaber]

Investing Quote of the Day: “If you don't want to take any risk, you shouldn't be in financial markets.” - Jean-Philippe Bouchaud

[Ryan Greiser, CFP® @Greiser]

Research from Michael Kitces:

Fixed indexed annuities replace market volatility with "issuer discretion risk."

The insurance carrier controls your returns. You can't negotiate. No transparency into their decisions.

Market risk didn't disappear—it shifted.

[Bob Elliott @BobEUnlimited]

Buffer ETFs are almost always a terrible deal for investors because of their high fees and gains capping, but hey at least the issuers get rich.

Last few years showed once again much better to 1) increase diversification and 2) hold cash to meet risk targets.

https://t.co/008uKuseIG

[The Kobeissi Letter @KobeissiLetter]

Some perspective:

1. Bitcoin averages 2 declines of -20% or more per year

2. Ether averages 3 declines of -20% or more per year

3. The S&P 500 averages 4 declines of -5% or more per year

4. The Nasdaq 100 averages 4 declines of -5% or more per year

5. Gold averages 1 decline of -10% or more per year

6. The VIX spikes above 20 roughly 40 times per year

7. The average S&P 500 stock declines -20% once every 12 months

Zoom out and ignore the noise.

[Barchart @Barchart]

Almost 80% of S&P 500 stocks declined today, which is the worst day of market breadth ever recorded, while the $SPX was making new all-time highs 🚨🚨

[Bob Elliott @BobEUnlimited]

Data this week confirmed pretty clear economic weakening and yet long-end yields remain at cyclical highs.

[Meb Faber @MebFaber]

“We estimate that the ETF tax efficiency has increased long-term investors’ after-tax returns by 1.05% per year relative to mutual funds in recent years."

https://t.co/7g4tgSq9iC

[Professional Financial Advisors, LLC @PFAretire]

🚗💡 What do car sales tell us about the real economy?
Let’s take a closer look at how this chart of auto sales says more about growth, recovery, and consumer strength than you might expect. A thread 🧵👇
#EconTalk #FinancialPlanning #MarketInsights

[MichaelKitces @MichaelKitces]

How Life Insurance Loans Really Work And Why It’s Problematic To “Bank On Yourself” https://t.co/IEeUXYXp0B

[The Idea Farm @TheIdeaFarm]

“It is only those who sell in panic in declines who become the real losers of the volatility inherent in financial markets.”
-- Francois Rochon

[Michael Green @profplum99]

3/3 But that's not the right measure. We need to consider Buffett's allocation to equities VERSUS what it would have been if he was fully invested. And on that basis, he is "underinvested" to near the greatest extent in history -- and he's been pretty good at market timing!

[Meb Faber @MebFaber]

Here are a couple of fun charts from the always great @JPMorganAM guide to the markets...

All time highs are bullish

[Patrick OShaughnessy @patrick_oshag]

Random AI thoughts after about 50 meetings with companies, investors, researchers last few weeks

- I’m amazed by the usage of “casual interaction” apps (eg Talkie). Friends, girlfriends, companions. I don’t think older people (I’m on the cusp!) get it at all. I don’t get it either, but it’s happening.

- most investors aren’t using AI AT ALL personally (let alone professionally). I find this wild. LLMs are a miracle for learning about complex topics quickly.

- as Martin Casado says, the cost of creation is going to zero. If you can imagine it, you’ll be able to create it.

- you need to act as if literally everything you say near a device is being recorded, transcribed and cataloged. And often (mostly?) without consent.

- the “child, teenager, college student, phd” analogy for how capable LLMs are across generations is useful, but we should also start thinking about the other axis of “phd level intelligence working on a problem for 10 seconds, 10 minutes, 10 hours, 1 month” to imagine what models might be able to accomplish

- we are all going to have a superhuman tutor for life, that teaches us anything we want, however we want, all the time. The world of learning is going to be so incredibly cool. I was recently driving through a countryside with many famous landmarks and had gpt4o tell us about the history and fun facts in audio as we drove by. Soon that’ll be linked to gps and maybe vision. Audio tour guide for the world, tuned to your interests, that can help you pattern match too.

- this will take years for usage of these models to diffuse across a population. Almost no one is really using them yet.

- I think even if we NEVER get a huge leap forward in frontier models from here, there’s still endless things to build.

- we so badly need the ability to have personalized pre-loaded/saved context and connectivity (so they can take more digital action on our behalf) for these models to unlock so much incredible use cases

- speaking of huge leap forward, I don’t think anyone really knows the answer to the data wall question. The other “hobblings” seem more solvable to me. I’m willing to bet humans figure the data wall out though.

- trying to think through how an ai app company will win long term is one of the bigger brain pretzels I’ve been in. We’ve made no pure AI app investments despite wanting to.

- the hardest challenge is imagining my own role as a professional in a GPT-6 world. The analytical work I do is not going to be valuable relative to models if things continue. I already feel like an actor stand in sometimes just asking about thinks the models prompted me to. F-in weird to think about.

[Geiger Capital @Geiger_Capital]

Warren Buffett and Berkshire Hathaway now own 4% of all T-Bills issued to the public…

Buffett has ~$277 Billion.
The Fed has $195 Billion.

Warren Buffett is now a larger holder of US Treasury Bills than the Federal Reserve.

[The Kobeissi Letter @KobeissiLetter]

What just happened in the bond market?

The 10-year note yield is now up over 20 basis points in since Friday's intraday low.

That's 20 basis points in a matter of hours without any material news.

For the first time in almost 5 weeks, the 10-year note yield is set to break above 4.50%.

Bond markets are trading like rate cuts got cancelled and inflation is on the rise.

Are bond markets telling us something?

[The Kobeissi Letter @KobeissiLetter]

56% of Americans believe we are in a recession, according to a Harris poll.

Meanwhile, GDP grown for 7 straight quarters.

Also, 49% of Americans believe that the S&P 500 is down for the year.

Meanwhile, the S&P 500 is at an all time high.

The disconnect here is massive.

[Stocktwits @Stocktwits]

How good was Jim Simons?

If you invested $10K into his Medallion Fund in 1988, you'd have $420M...let that sink in

▪ If you invested in $SPY, you'd have $400K
▪ If you invested in $BRK, you'd have $1.5M

RIP to the Quant King 🙏

[Ben Carlson @awealthofcs]

S&P 500 in the 30 years ending 2023:

+10.1% annual return

Finished up 80% of all years

Down double digits 4 of the years

Up double digits 19x

4 out of every 10 years finished up 20% or more

Not bad considering everything that transpired

https://t.co/hTPR1buRGY

[CFP Board @CFPBoard]

We commend @USDOL for expanding fiduciary advice under ERISA with the final Retirement Security Rule. By aligning with investor expectations, this rule helps ensure that financial professionals prioritize clients' best interests, enhancing retirement security for all Americans. Read our full statement: https://t.co/PBv6bk4jXz #RetirementSecurity #FiduciaryRule