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Hello there.

 

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This is Byron Braun of

Braun Wealth Management Group.

 

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And today what I would like to try to

 

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accomplish is address some of the top

questions that we are receiving on an

 

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ongoing basis during this

very complex environment.

 

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And to begin with today, the big question

 

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on the table is where is the

direction of interest rates?

 

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Well, the Federal Reserve at their last

meeting just recently decided to "skip" is

 

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the term that most economists

are using right now.

 

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So interest rates are going to stay

at the current Fed funds rate of 5%.

 

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Why is this important?

 

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Basically, it allows what I would call the

 

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medicine to take effect on its

efforts of reducing inflation.

 

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So as we move forward, the Federal Reserve

 

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has left the door open

to be data dependent and possibly raise

 

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one or two more times

that only time will tell.

 

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And if the efforts to reduce inflation

 

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continue in a good way, probably

the skip will happen again.

 

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But as of right now, one or two more.

 

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And what I'd like to share with you

is a chart from the Federal Reserve.

 

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And the reason why I want to talk about

this today is because the trend of

 

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interest rates is not like

Apple having a bad quarter.

 

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Trends of interest rates evolve over

1, 3, 5, 10, 15 year time frames.

 

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So if you look at this chart, back in July

of 2006, the federal funds rate hit a high

 

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of approximately five

and a quarter percent.

 

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If you go forward to the right on this

chart, it begins to drop to December of

 

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2008 to approximately 1%, and stayed

there all the way through to 2015.

 

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Then it began to climb back into 2019 at

 

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around 2.5%, back down to 0% in 2020,

 

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and now we're at 2023 at a 5% rate.

 

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So what does this chart try to share with

 

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you is that interest

rates evolve over time.

 

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So the current interest rate climate could

be classified as one of the best rates

 

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that we could acquire in a generation,

according to many economists.

 

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The next question we get is

what is the trend of inflation?

 

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Inflation over 15 months ago was

about 9.1%. Today we're at 4%.

 

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That is an amazing feat to

have that dramatic of a drop.

 

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And inflation is the number one enemy as

far as the Federal Reserve is concerned.

 

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And so they're willing to sacrifice jobs.

 

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For example, unemployment has raised to

3.7%, the economy is beginning to slow,

 

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existing home sales are down 20% plus

year over year, so on and so forth.

 

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But as that continues the softness in

 

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demand in our economy, then inflation will

probably stick here for a little bit.

 

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The word you may read in Barron's, for

example, is they're using the word it's

 

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sticky right now, but the trend will

continue downward and hopefully they can

 

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get into the three or lower over

the next six to twelve months.

 

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And the last question that we're

getting is what is the trend from now?

 

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We've been very fortunate to have the

standard and Poor's, for example, register

 

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a double digit return the

first six months of this year.

 

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Quite frankly, very surprising.

 

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But as we move forward,

 

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if the inflation rate continues to fall

and if the Federal Reserve does not go

 

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wild and go beyond one or two more

interest rate increases, your

 

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expectations, in my judgment, should be

continued volatility with an upward bias.

 

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And so we are what we call very positive

on the direction of the markets.

 

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Many of you have probably read most

about artificial intelligence.

 

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Artificial intelligence is indeed going to

change the way we live in our daily lives.

 

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But it also will have a profound impact

on corporations and communities.

 

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It will have the ability to make

them run more efficient in time.

 

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So companies like Microsoft are the

leader in this artificial intelligence.

 

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So as it becomes more broadly accepted in

 

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our society and in corporations,

earnings will become more streamlined and

 

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more efficient, making

stocks very attractive.

 

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And if you couple that with.

Interest.

 

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Rates staying here and then gradually the

 

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playbook will be as inflation dips into

the three or lower, the Federal Reserve

 

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will probably have a tendency to

lower rates sometime next year.

 

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So it is my hope that we have helped you

 

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with just a thumbnail sketch of

what's happening in today's climate.

 

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The most important for us is to

communicate with you as our clients.

 

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So it is very important for us to know if

things have changed in your personal

 

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situation, your income needs have

changed, things of that nature.

 

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So we stand ready to help

you in those endeavors.

 

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We stand ready to review your

allocation.

 

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And in all of that our goal is to help you

 

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protect and preserve your

wealth now and for the future.

 

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So we thank you very much for your

trust and confidence in referrals.

 

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Have a great summer and let us know

if we can be of any assistance here

 

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at Braun Wealth Management group.