Broker Check

The RFG Weekly Wealth Report

January 30, 2017
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After a brief pause during inauguration week, stocks continued to climb last week. The S&P 500 added 1.03%, the NASDAQ was up 1.90%, and the MSCI EAFE increased by 1.29%. The Dow also grew, adding 1.34% while hitting 20,000 for the first time ever.

Consumer confidence matched this positive performance, as the University of Michigan Consumer Sentiment measurement beat expectations in January and reached the highest levels since 2004. However, one piece of data we received last week gave a less rosy view of the economy: initial GDP reports.

What Happened: GDP Missed Projections

On Friday, we received the first report on real GDP for the fourth quarter of 2016. Growth declined significantly to come in at 1.9% - down from the third quarter's reading of 3.5%.

Looking deeper

Many aspects of our economy showed solid growth in the fourth quarter. Household purchases grew, business-equipment spending advanced for the first time in over a year, and inventory accumulation increased. Net exports, however, pulled growth down by 1.7% - the biggest drag since 2010 - as we saw a jump in imports coupled with a decline in exports. Working to increase U.S. exports is important because it can help strengthen America's economy, support additional jobs, and promote sustainable growth.

Without net exports pulling down economic expansion, fourth-quarter GDP could have been even higher than in the third quarter. Trade is integral to our economy, and changes in the balance between imports and exports measurably effect growth. The new administration's potential plans to tax Mexican imports, change trade relationships with China, and restrict visitors from certain countries could affect our imports and exports - and thus our economy.

Between lagging GDP and the Dow reaching historic levels, this week showed us a range of perspectives on where the economy now stands. The markets will always have uncertainty and unanswered questions, and - as always - we must stay focused on the fundamentals that drive performance in the long term. For now, we will continue monitoring policy developments and the trade deficit to determine how they may impact economic growth in 2017 and beyond. We will also pay close attention to the economic data that gives the deep insight upon which we build our strategies for pursuing your goals.

Quote of the Week

"Never bend your head. Always hold it high. Look the world straight in the eye."

--Helen Keller

Golf Tip of the Week

Use Your Thumb to Control Ball Flight in Your Short Game

In golf, a good short game can really determine how well you play. To reach your potential, you need to be nimble and have the ability to hit the ball higher with more spin in some situations, while being able to hit the ball lower with less spin in other situations. With practice, you can control how high or low you hit your chip shots. The secret? Your right (or left, for lefties) thumb.

For High Shot With Backspin

  • Swing through impact.
  • Hold off your hands' rotation so that your right thumb (or left) stays on the handle's right side (or left, for lefties).

For Low Shot With Run

  • Swing through impact.
  • Let your hands rotate through naturally. Your right thumb will end up on the grip's left side (or left thumb on the grip's right side, for lefties).


  • Righties: Thumb to right for higher shots; thumb to left for lower shots.
  • Lefties: Thumb to left for higher shots; thumb to right for lower shots.

Financial Question of the Week

Why do I need an estate plan?

The biggest reason to have an estate plan is to make sure that your personal values about both medical and financial matters are honored in the event that death or incapacity prevents you from acting for yourself. In addition, tax minimization is a further and very important goal of estate planning for persons with taxable estates. To create an estate plan for yourself or update an existing plan, you will most likely need the services of an estate planning attorney.

When you consult with an estate planning attorney, the attorney considers how you want assets distributed to heirs, what taxes your estate might be liable for and whether there are tax-minimization strategies that would be appropriate and appealing; what your preferences and values are with respect to the management of medical and financial affairs in the event of incapacity; and any complicating family issues. To deal with these issues, we often work with you and your attorney to help provide full and accurate information about you.

When an estate plan is formulated, be sure you understand what the attorney is saying. Estate planning ideas can be elusive, but strive for a working knowledge of the material presented for your consideration.

Please contact my office if you or someone you know would like help getting the estate planning process underway.