Summer Perspective 2023

The best way to cherish life is to remind yourself of life’s impermanence. It is to remember that every time you see someone that is one less time you see them. It is to remember that every time you go somewhere that is one less time you visit. By doing this, you naturally slow down. Almost like a reflex, you start to truly live. ~ Andrew Anabi

It has been a pleasure to host many of you in Lexington over the past twelve months. We have shared experiences of great joy – new family members, and loss – the passing of friends and loved ones. It is in the "sharing" that our joy is magnified, and our pain halved.

One of the pandemic’s great lessons has been the importance of community and in-person communication. Over tea, coffee, and chocolate our guests have invited discussions related to:

• Will I be able to change careers and retire comfortably?
• What’s the best approach to caring for an aging parent?
• Can I educate my children without derailing our hope for financial independence?

These are important objectives and worthy of conversation. We wish to listen, discuss and propose appropriate solutions.

Our 2023 investing outlook started with a theme of returning to normalcy. Considering 2022’s market volatility and the aftereffects of the pandemic, the idea of finding balance was certainly a welcome change.

2023 has come with its own set of challenges. We saw two regional banks fail in succession in March and another closed its doors in May. Collectively representing over $530 billion in assets, the trio ranks as the second, third, and fourth largest bank failures to date.

We also held our breath as a last-minute deal to raise the debt limit came together as the clock ticked closer to default. Despite the market gyrations these events caused and with the banking sector still on tenterhooks, the overall financial system seems stable. Counterbalancing the challenges were some bright spots including:

• Inflation is under 5% at home, significantly lower than its 8.3% level last year.

• Interest rates set by the central bank appear to be approaching their apex.



• Global inflation has ticked down from its 8.7% high in 2022, and is following a slow descent to a projected 6.5% for 2023.

These are things that shape our perspective on the next six months or so. They come with some potential opportunities for investors—opportunities that may present themselves in international equities, core bonds (particularly if the Fed is indeed done raising rates), and industrials. (Source: LPL Research)

Economic Overview

Consumers are still unleashing pent-up demand for services. We expect the Fed to end its rate hiking campaign in the latter third of this year and introduce the possibility of a cut in rates as economic conditions weaken. When inflation convincingly cools, markets are likely to respond favorably. (Source: LPL Research)

Residential Real Estate Update

While housing prices have stabilized, many of you have wondered at their stubbornly high nature. The answer lies in the lack of inventory to meet growing demand. Why? Most outstanding fixed rate mortgages are at or below 4%. Homeowners appear unwilling to trade those loans for a new home and a corresponding loan at or above 7%.

If you are looking to trade-up, patience is required. More building should help relieve supply constraints. As for rate relief, the Mortgage Banking Association projects a 30-year rate of 4.8% at the conclusion of 2024. (Source: The Outlook, June 12).

Stock Market Perspective

We receive many questions about this year’s stock market rebound and the likelihood of forward gains. While we cannot predict market behavior, it is useful to understand the 2023 rebound and, more importantly, why we and our investment partners remain optimistic for longer-term growth.

As of July, the ten largest companies in the S&P 500 Index accounted for 32% of the market’s size and 21% of its total earnings (Source: JP Morgan research). The top half of those included familiar names: Apple ( 7.7%), Microsoft (6.8%), Amazon (3.1%), Nvidia (2.8%) and Alphabet (1.9%).

One measure of value (commonly referred to as the price to earnings ratio or P/E) is what investors are willing to pay for each dollar of company earnings. The top ten index companies were recently priced at 29.5 times their projected forward earnings.

The remaining 490 names were priced at a much more modest 18 times.

Put another way, most large American businesses were priced (on July 17) at a 39% discount to their larger brethren. The discount grows even larger when we look at both the “value” tilted companies and non-US domiciled ones our investment partners favor. There is a sustainable growth opportunity to be found outside the market “giants”.  

What your peers are Saying about Wealth

These are some fascinating take-a-ways from a June 19 Barron’s essay. It detailed results from a recent Schwab study on Americans’ attitudes towards wealth.

• 48% of respondents described themselves as wealthy.

• They reported an average net worth of $560,000 and “cited nonfinancial factors like health and family in estimates of their ‘wealth’”.

• And yet $2.2 million was the average amount cited as necessary to be wealthy in America – what Schwab refers to as the “wealth paradox”.

• 70% of respondents indicated that wealth “is more about enjoying experiences than owning nice things”.

• Only 30% believed it necessary to have more money than most of the people they knew.

• 69% declared that a healthy work/life balance and job flexibility are of greater importance than maximizing earnings.

• Most respondents believed it preferable to be more generous with loved ones now than after death. 

Credit Freezing

We continually encourage our clients to freeze their credit to make it difficult for others to apply for credit in your name. You may, as needed, un-freeze and re-freeze your reporting with the following credit agencies:

• Equifax  1-800-685-1111 www.equifax.com/personal/credit-report-services/
• Experian  1-888-397-3742 www.experian.com/freeze
• TransUnion  1-888-909-8872   www.transunion.com/credit-freeze

Direct questions to Lena at Lena@alenawealth.com

Fall and the approaching Political Winter

Intra-party debates and primary voting season are fast approaching. America has challenges to confront - emboldened enemies, strained budgets, and entitlement reform to name a few. Change will require fresh, sober, and courageous leadership. We wonder whether we as a nation are up to the task.

As we weigh the period, policies and persons placed before us, I resurrect the words of one of history's greatest peacemakers, Mahatma Gandhi. He knew what was worth avoiding to achieve a more just and sustainable future.

Seven Social Sins

Politics without Principles

Wealth without Work

Pleasure without Conscience

Knowledge without Character

Commerce without Morality

Science without Humanity

Worship without Sacrifice

Lena points out, interestingly, that the Greek word for sin is "amartia" which literally means to "miss the mark" in archery.

LPL Focus Conference



ALENA Wealth team members Kathryn Dunlop and Mike Ioffredo joined Cathy and me recently in San Diego for the annual LPL education event. Joe and Lena attended the conference virtually.

We participated in many interesting sessions on planning and investment topics. 

Kathryn shared “pearls of wisdom” from her session on retirement. These points reinforce the benefits of pre-retirement planning.

• Retirement does not change us; it merely magnifies who we are.

• Losses – of routines, mental stimulation, and social connectivity, can outweigh gains – freedom and flexibility.



• Retired people are twice as likely to experience depression.



• Create “it” before you get there; rather than leaving it open-ended, have a plan and, when possible, ease into it slowly (a period some label re-wirement).

ALENA Wealth News

We are proud to announce a new addition to our ALENA Wealth Family. Mike and Caitlin Ioffredo had a beautiful baby girl, Marlowe Marie on May 15^th. 

We hope to visit with many of you this fall and winter. We remain grateful for your patience and trust during these hope-full days.

Alan, Lena, Joe, Kathryn, Mike and Cathy

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. Investing involves risk including the potential loss of principal. No strategy can assure success or protects against loss".

ALENA Wealth LLC is a Registered Investment Advisor

Securities offered through LPL Financial, Member FINRA/SIPC