An Inverted Yield Curve and You

By Jay Pluimer, AIF® CIMA®

Friday, 16 August 2019

The big news on August 15th announced an impending recession due to an inverted yield curve. Some clients may have been surprised to see that as a major headline since there have been other headlines over the past few months saying the exact same thing, just without an 800-point drop in the market. The goal of this update is to explain what an inverted yield curve is and what it means for your investments.

What is an Inverted Yield Curve?

It’s important to start by differentiating the stock and bond markets from the economy. The markets react to what is happening in the economy and then try to predict what will happen next. In this case, the bond market has been reacting to slower global growth by paying less interest for long-term bonds. Usually, an investor expects to get paid more (higher yield) for buying a long-term bond because there is more risk and uncertainty than with a short-term bond. The headlines on August 15th reflect that 10-year Treasury bonds are paying less interest than 2-year bonds (which, for perspective, was accurate by 0.022% and lasted for less than a day). However, the yield curve isn’t 100% accurate in predicting a recession, nor can it predict when the recession will start or how long it will last. The yield curve inverted in late 1966 right before an extended period of economic growth and there was also a brief inversion in 1998 when the yield curve was very flat, similar to our current environment, which also didn’t accurately predict a recession.

When an Elderly Parent is Being Taken Advantage Of

By Kathy Longo, CFP®, CAP®, CDFA

Friday, 09 August 2019

When an Elderly Parent is Being Taken Advantage Of
A note from Kathy:

This is a hard topic. No one wants to think that a family member could take advantage--perhaps even steal from or willfully mislead--their parents. This article will help you wade through this challenging time. Rest assured, you aren’t alone. I was motivated to focus on elder financial abuse because so many of my clients have dealt with it.

Talking to a sibling or relative about the abuse will no doubt be very hard. But, in some cases, open communication and transparency may be enough to fix it. It may be as simple as putting limits in place and creating boundaries. Even in the simplest situations, people will get defensive and people will choose sides. You may need to take legal action, or even involve the police. This won’t be easy, but it’s the right thing to do. Follow the important public safety slogan: If you see something, say something. 


An Aging Population 

Two things are happening at once: people are living longer and more of that population suffers from a mental impairment. In fact, 1 in 3 seniors dies with Alzheimer’s or another dementia and between 2000 and 2017 Alzheimer’s deaths increased 145%. Over 5.8 million Americans are living with Alzheimer’s in America and by 2033 it’s estimated that an additional 3 million will be diagnosed. What that means is we have a large pool of Americans who are impaired and need help to manage themselves. Unfortunately, like all vulnerable populations, that opens them up to abuse.

Elder abuse, especially to those with a mental impairment, can be hard to police because this is often an isolated population. Even more challenging is that 60% of elder abuse is committed by a loved one or caregiver. Elder financial abuse and fraud loss can range from $2.9 billion to $36.5 billion annually, and considering that it tends to be self-reported, the numbers are most likely higher. 

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