3rd Quarter Updates and Commentary from IEM |
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Dear Friends,
What a wonderful stretch of weather we've had to start the Fall season! We hope you are enjoying it, as well as staying healthy and safe. For our 3rd Quarter Update and Commentary from IEM we have a lot of interesting material for you to dive into including:
- Market Commentary from IEM's CFO Daniel Schoenecker
- PWM Thought Leadership from Danica Goshert, Charles Stewart, and Dan LaNasa
- Looking Ahead to Key Financial Planning Dates in November
- Other Happenings at IEM.
We hope you enjoy the latest material we have to offer you, and we wish you all the best as we get closer to the end of the year.
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Q3 2021 Market Commentary |
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Since the March 2020 market low the equity markets experienced five consecutive quarters of strong, positive returns. That trend leveled off in the third quarter of 2021, which is elaborated on below. First, the third quarter returns of major indices were approximately as follows:
S&P 500: +0.5%
Russell 2000 (Small Cap US Stocks): -4.5%
MSCI ACWI Ex-US (International Stocks): -3%
Barclays Aggregate Bond: 0%
Front of mind for many investors is how the intersection of inflation, fiscal policy, and monetary policy will impact the economy and capital markets going forward. To understand the current environment, it’s worth taking a brief historical lap to the 2008 Global Financial Crisis (GFC). In the decade that followed, a consensus view emerged that policymakers were too slow and went too small in support, prolonging and deepening the recession. Consequently, the idea was that in the next major market disruption, policymakers should move quickly and provide much larger stimulus.
That playbook has played out since the COVID crash. One back of the napkin comparison is to see the change in money supply in the eighteen months during the two events: 0.5 trillion increase (GFC) vs 5 trillion increase (COVID). As a result, many investors were caught fighting ‘the last war’, expecting a deflationary/recessionary environment, instead of the current inflationary environment.
The question to be answered in the coming quarters and years is whether policymakers hit the sweet spot or overshot in the stimulus. The Federal Reserve has argued throughout the year that inflation would be transitory, but it is currently up for debate if that will be the case with inflation presently persisting, in consideration of both the stimulus and severely disrupted supply chains.
As mentioned before, my hope in providing the above analysis is to stimulate helpful conversations between clients and the advisor team at IEM. A key tenet of our investment management and financial planning is to focus on areas within our locus of control. It is our belief that by doing the blocking and tackling correctly – well diversified portfolios, suitable asset allocations, tax minimization, thoughtful financial planning strategies – we can help people achieve their goals regardless of market environment.
Please do not hesitate to call, email, or use our online portal at any time to touch base with myself and the team at IEM. I wish you all a wonderful Fall season!
Best,
Daniel Schoenecker, CFA, MBA
Chief Financial Officer
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Disclosure: Certain sections of this commentary contain forward-looking statements based on our reasonable expectations, estimates, projections, and assumptions. Forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties, which are difficult to predict. Past performance is not indicative of future results. Diversification does not assure a profit or protect against loss in declining markets. All indices are unmanaged and investors cannot invest directly into an index. The S&P 500 Index is a broad-based measurement of changes in stock market conditions based on the average performance of 500 widely held common stocks. The MSCI ACWX Index is a float-adjusted market capitalization index designed to track the investment results of an index composed of large and mid-capitalization non-U.S. equities. The Russell 2000 Index measures the performance of the 2,000 smallest companies in the Russell 3000 Index . The Bloomberg Barclays Aggregate Bond Index is an unmanaged market value-weighted index representing securities that are SEC-registered, taxable, and dollar-denominated. It covers the U.S. investment-grade fixed-rate bond market, with index components for a combination of the Bloomberg Barclays government and corporate securities, mortgage-backed pass-through securities, and asset-backed securities. |
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IEM Private Wealth Manager Insights
IEM's Private Wealth Managers have another round of great reflections for you for in this quarterly newsletter!
Please click the buttons below to read Dan LaNasa's, Charley Stewart's and Danica Goshert's most recent insights titled Back to School COVID Conundrum, Assessing Your Debt-to-Income Ratio, and Curveballs: Not Just for Baseball on our website or LinkedIn. Happy reading!
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Looking Ahead:
Key Financial Planning Dates for November
Please click the link below for information to help you stay on top of your personal finances and key financial planning dates for the month of November:
The grace period for May graduates is coming to an end. Recent graduates still looking for employment may want to investigate their options for deferring payments.
If you are thinking of establishing a Donor Advised Fund in the near future we recommend you speak with your advisor by November 15. Donor Advised Funds, in particular, are very sensitive to processing timelines.
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Recent Hire - Lucas Hemling |
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Please join us in welcoming Lucas Hemling to the IEM team!
Lucas joined IEM in September 2021 with comprehensive knowledge of investment products, programs, and processes. He prides himself on being an exceptional teammate while communicating effectively on a deeper level with clients. Lucas is also skilled in time management and being a driving force to assist our IEM Operations department as a Senior Registered Client Services Strategist.
Prior to joining IEM, Lucas had extensive experience in the financial services industry in previous roles as a Customer Care Professional and Financial Associate. Looking to take the next step in his career, he can’t wait to dive into the finer details of his new position with IEM.
Lucas earned his B.A. in Business Administration from the University of Wisconsin-Stevens Point and holds his FINRA Series 66, 63, 7 and 6 registrations, as well as Minnesota and Wisconsin Life Insurance Licenses.
Lucas lives in New Brighton, MN. He and his fiancé, Alayna, will be getting married in November of 2022 in the sunny paradise of Fort Lauderdale, Florida! He enjoys spending time at the gym, traveling, and trying new cocktail recipes. Being a Wisconsin native, he's (unfortunately) an avid Green Bay Packers fan.
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IEM 4 Year Work Anniversary - Suzi Chochrek
Suzanne (or Suzi, as she is known in the office) started with IEM in 2017 as Ted’s Executive Assistant. She is now part-time, providing bookkeeping support and helping IEM with philanthropic projects.
When she isn’t at the office she enjoys long walks with friends, visiting her two boys away at college and spending time with her step-daughters, husband and three dogs.
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Team Event at Top Golf - Ted's 45th IEM Work Anniversary!
It was such a wonderful team work event and we all did a great job surprising him with a trip to Top Golf.
Thank you, Ted, for everything you have done for us and our clients. Your dedication, genuine care, and ability to lead by example is truly inspiring.
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Hold Your Horses Event and IEM Sponsorship
On Sunday, October 3rd IEM was proud to help Hold Your Horses with a $7,000.00 sponsorship for their Lily Plop Bingo Virtual Event fundraiser! Hold Your Horses provides equine therapy for children and adults dealing with trauma and disabilities to help increase their quality of life.
IEM will continue to have a positive impact with Hold Your Horses and our other philanthropic initiatives for many years to come.
For any and all of our clients who participated and donated THANK YOU!
If you would like to learn more about Hold Your Horses, Click HERE.
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IEM Birthdays
Last month, IEM celebrated three birthdays in the office - Director of Operations & Compliance Noah Merten, Senior Registered Client Services Strategist Lucas Hemling, and Chief Financial Officer Daniel Schoenecker. (Please note, being the definition of a minimalist, Daniel Schoenecker is not pictured below, but we still want to include him in our birthday wishes!)
Happy Birthday to all three of you! Thank you for keeping IEM running smoothly and making sure our clients are well cared for.
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Best Wishes,
Ted Smith, Danica Goshert, Charles Stewart, Dan LaNasa, Melanie Kriegler and the entire IEM team.
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Integrated Equity Management
8009 34th Ave South
Suite 1550
Bloomington, MN 55425
(952) 854.5544
Securities and advisory services offered through Commonwealth Financial Network®, Member FINRA/SIPC, a Registered Investment Advisor. Fixed insurance products and services offered through CES Insurance Agency.
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