January 2024
ALWAYS OPTIMISTIC ABOUT AMERICA!

 

I’m really excited about 2024. We have expanded into Texas with great energy thanks to our newest superstar colleague, Kate Finley. The economy looks like it has a solid chance of avoiding a recession, even after all the rate hikes. And, the stock market just set a new all-time high erasing the drop of the 2022 bear market.

Our new Texas office is up and running, and we’ve gotten great feedback on our name change to Trinity Strategic Wealth. We have offices in four cities now, and just recently passed the $1.4 billion mark in assets under management thanks to you, our wonderful clients.

As we hoped for 2023, the pace of inflation, although not nominal prices themselves, did retreat and shows progress towards the Federal Reserve’s target of 2%. The Fed appears to be done with rate hikes, and the stock market finished off 2023 with a strong rally.

I’m also looking forward to the Presidential campaign cycle this year. You probably think I’m crazy, but 80% of U.S. Presidential election years are positive for the stock market. So, bring on Biden versus Trump! I know you are shaking your head right now, but fortunately the more significant matter for 2024 is the action of the Federal Reserve.

We are certainly mindful of the risks out there which include a possible economic slowdown, the uncertainties that come with election years and possible geopolitical tensions. But as you have seen, long-term, high-quality investment strategies with good diversification did just fine the last 5 years even with a global pandemic and rough 2022 bear market. Together, with a good financial plan, we can handle the future.

We are always optimistic about America and our innovative spirit that drives value for consumers and creates wealth and prosperity! Oh, and one other item makes me excited about 2024. My youngest son Jackson will graduate from college, and I will be done with college tuition expenses for 5 kids! Free market capitalism made this possible, and I’m so thankful we live in the greatest country in the world!

Have a wonderful 2024!

Sincerely,


Mike Mazzei, CFP®, MPAS®
MASTER PLANNER ADVANCED STUDIES®
President, Trinity Strategic Wealth™
mike.mazzei@raymondjames.com
(918) 858-2802


MAY 2023
“Stewarding Assets”

One word we routinely focus on at Tulsa Wealth Advisors is “steward”. In the Biblical sense, a good steward manages what God has given them. In the financial sense, a good steward manages clients’ assets which have been entrusted to them. As stewards we also continually think through what will help our clients achieve their life and financial goals with greater clarity and confidence. We work to balance short-term considerations with longer-term ones to come up with an investment allocation which fits each client’s individual needs and wants.

We begin our investment process with the economic and market outlook. To that end, we believe there are three key themes for the next 12 months. First, the risk of a recession has increased. Monetary policy works through a 12-18 month lag from when changes are made to when those are reflected in the economy and markets. The Federal Reserve first raised interest rates from 0% in March 2022. Since then, interest rates have risen to 5.1%, the quickest tightening cycle in United States history. The effects became evident in March with the failures of Silvergate Bank, Silicon Valley Bank, and Signature Bank. The ongoing issues within the banking sector raise the prospect of a significant tightening of credit conditions in the United States. Less lending from banks means slower economic growth and likely a recession.

Second, we believe central banks will have to do less heavy lifting to get the same result: tighter financial conditions, which slow credit growth, demand, and eventually inflation. The May rate hike could well be the last one of this cycle, but the bar to actually lower rates remains high until inflation comes down further. Going from 8% to 4% inflation is easy, but going from 4% to 2% is proving to be much more difficult.

Third, we believe fiscal policy is unlikely to come to the rescue if economic conditions deteriorate. Elevated government debt, divided U.S. government, and the belief that the large fiscal response during the pandemic caused the current inflationary environment means the fiscal response is likely to be lagged and less aggressive than previous recessions.

What does all of this mean for stewarding your investments? In the current environment, and particularly given the banking sector challenges, we want to be careful with the amount of risk within the allocations. That requires a focus on high quality and resilient investments. We prefer stocks with strong balance sheets where free-cash-flow is being generated. Within bonds, we are focused on Treasuries, government-guaranteed mortgages, and only the highest rated corporate bonds. That quality provides resiliency in a slowdown and can be used as dry powder for buying opportunities within the allocations.

Later this year, if the economic outlook reaches a point of greater clarity, accompanied by a repricing of economically sensitive market sectors, it could be time to go on the offensive.

Thank you for your continued trust and allowing us to serve you.

Sincerely,

Andrew K. Steinmetz, CFA, MBA
Branch Chief Investment Officer
Trinity Strategic Wealth/Raymond James