WEBVTT

 

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Welcome.

 

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On behalf of Braun Wealth Management

Group, we would just like to share some

 

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thoughts today, and most of these thoughts

have been articulated from our clients

 

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over the last time that

we've been together.

 

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So let's take a look

at the first question.

 

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And that question is where we are now?

 

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As the chart indicates,

the interest rates are as follows.

 

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And these are, as of August 28th, 2023.

 

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The two year treasury is now at 5%.

 

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The five year is 4.38%, the ten year is

4.2% and the 30 year is 4.28%.

 

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The next slide shows you the

general market performance.

 

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The Standard and Poor's 500 through

the same time frame is up 16.7%.

 

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The Nasdaq is 31.7% positive, and the Dow

 

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Jones a positive 5.7%. Needless to say,

we've had a very good climate thus far.

 

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So the real question is amongst many

 

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investors is what is the Federal Reserve

going to do from this point forward?

 

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The best guess is that they're going to

 

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let what I call the "medicine"

continue to do its work.

 

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And one of the things that's important

to this is the housing market.

 

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So for example, and this is according to

Redfin, and these are interesting stats

 

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82% of all mortgages in the United

States have a 5% rate or lower.

 

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62% have a 4% or lower rate.

 

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This is a very unusual climate that we're

 

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in, and most economists will call this

people are "handcuffed" to their mortgage.

 

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What they mean by that is that if you want

 

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to move to a better school system, if you

want to go to a better community, or if

 

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you want to go to a larger home, if you

sell your home, a

 

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nd then you have to buy a new one and

you have to mortgage it at seven,

 

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seven and a quarter, or even

seven and a half percent.

 

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Thus most homeowners are

not going to do that.

 

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What's happening right now is existing

homes are a very short supply.

 

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Thus what this means is the volatility in

 

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the real estate market and the movement of

funds is slowed, thus will help the

 

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Federal Reserve

in their quest to lower inflation.

 

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A second item also too is adjustable rate

 

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loans that most businesses

have in America.

 

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Most businesses will have their short term

 

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rates reset every three, six, nine

months or even twelve months.

 

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So as we move forward, many of these loans

are being reset, and thus the cost of

 

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money to most businesses in America are

increasing 10, 15, 20, 30, even 100%, thus

 

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slowing more economic activity so that

during this process, the Federal Reserve

 

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is likely to stay where they're at

and let this work through the system.

 

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So my guess is your expectation should be

the Federal Reserve will stay pat

 

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5, 6, 7, 8 months, review the data,

and then possibly start to ease back.

 

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So what this does is it creates a climate

where there's still volatility in the

 

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marketplace, there still is volatility

in bonds and stocks and real estate.

 

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But as we meander through this, then

you'll see a normalization five, six,

 

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seven months from now, a normal bond

market, a normal real estate market and a

 

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normal stock market. Which is all good for

us, because we, helping you with your

 

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portfolio, will have a more stable

environment in which to construct

 

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portfolios to meet your

expectations for the longer term.

 

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So if we just think about this.

 

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The last 15 months, inflation has gone

 

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from nine to like, three and a quarter,

three and a half, interest rates and

 

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Federal Reserve has gone from zero

to five and a quarter percent.

 

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Both dramatic.

 

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Both has helped the

fight against inflation.

 

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We've also had a divided government, which

helps slow spending changes in Washington.

 

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And we've also had the delivery systems in

 

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our society get better, whether it be

shipping, rail, trucking, et cetera.

 

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So what this all means is that we've

had a very nice start to the year.

 

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We believe volatility is

still the name of the game.

 

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The Federal Reserve's eye will be on

 

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inflation, probably stay

pat for where we are.

 

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And that last 1% or so is going to

be the hardest to get for them.

 

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So it could take 3, 4, 5, 6, 7 months to

 

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get there, but we believe the

journey will be accomplished.

 

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So from this point forward,

our advice to you is give us a call,

 

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reevaluate your allocation, talk to us

about your needs if they have changed.

 

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And in the longer term, we believe that

 

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these changes will help all of us

in the United States.

 

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So again, we thank you very much

for your trust, your confidence.

 

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And should you have any questions, feel

free to always call us or email us.

 

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And our entire team here will be standing

 

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ready to help you make the

decisions that you have to make.

 

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Again, we wish you all the best

and have a great fall season.