financial planner Stephen Zelcer

TSP Planning Report June 2018

When can I retire

Facts:

  • Unemployment dropped  even further, to 3.8%.
  • The S&P 500 posted a solid 2.41% gain.
  • PMI, again, posted another stellar month of expansion, with the index reading 58.7%.
  • The 1st estimate for 2018’s 1st quarter’s GDP was revised down to 2.2%.

Assessment:

  • The Unemployment report is almost too exciting.  These levels are flirting with employment levels not seen since 1969 (48 years)!  However, a report by Kessler reasearch points out that such low levels have been followed by bear markets, so don’t get too giddy!  I’m not going to jump at this info unless we see it holding somewhat consistent over next few months.
  • The S&P YTD is now positive 2% after the past 3 month hot streak yielding 4.7%
  • PMI continues it’s impressive streak, performing above-average (above the 50% mark) for the past 18 months.
  • The 2018 Q1 GDP numbers are healthy for a first estimate.  Historically, Q1 GDP is the lowest GDP producing quarter.

Bottom Line:

Trump is back to his trade-war dramas, and he’s also trying to make history by negotiating with a dictator.  This past weekend was very bumpy ride for America’s relationship with Canada – one of our closest allies.  The major banks have announced raises to interest rates.

If I didn’t have my TSP investment models to keep me sane, I would be shivering in my boots like a nervous nelly!  All of the above news SHOULD drive the market down…

…temporarily.

But because we’re investing in companies, we mustn’t ignore what the corporate world is doing.  Are they hiring or firing?  Making profits or losing?  Producing or slacking?  The corporation’s behaviors and balance sheets are great indicators of the stability of the economy.  When business starts to falter, there are warning signals.

So, yes, there are temporary blips but remember, there’s hype and then there’s fundamentals.  The fundamentals are still solid.  Always be on guard against media hype.

Be sure to view all 2 pages of the embedded report below.  The TSP portfolios below carry the greatest return for the least amount of risk in this economic environment.  Remember, DON’T JUST LOOK AT RATE OF RETURN.  Always view the target return of each portfolio in context of its ranges of fluctuation.

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