Northern Star Newsletter 11/16/2017

Message from Jon

Market Update:

We are seeing the pre-emptive effects of the president's tax reform hitting the markets this past week or so. Especially today, where there is now some doubt creeping in as to his ability to get a legitimate version of the reform bill passed as it stands. My opinion is that unless the reform appears to look after the best interest of the common man, then we will end up with a rewritten version that looks NOTHING like its original predecessor, effectively being politics as usual once more in DC.

At present, the media is portraying the reform as looking after and catering to the interest of the rich vs. the common man, and as everyone knows, what the media says has to be the truth or they wouldn't say it, right?

Change is always violent. Some take this statement as literal, but it is also true from a physics standpoint as well, meaning that in order to change the status quo of any object or circumstance, one must exert an unusual amount of force to do so. We are seeing this in technology, financial systems, political pressure, social issues, and now even in our entertainment with the recent kneeling during the anthem and the Hollywood scandals. The norms are being challenged everywhere we look, and in the end, this will be a good thing I think - but while we are going through it, not so much!

In my opinion, the one problem with change is that we tend to act irrationally at times during the process of change. The last thing anyone should do is let their emotions overtake their senses and run the roost, especially when it deals with healthcare and money. Both of these items need logic and rationalism to be effective in the long-run and avoid regret.

We are still in a healthy rally even though we are currently experiencing some volatility and potentially a normal 3-7% pullback. At the moment, we stay the course and hold the line as it were.

Till we speak again, enjoy your week, and we will see you at the Gala!

Jon

After posting gains every week since September, U.S. stocks declined by market's close on Friday. The S&P 500 and Dow ended their longest stretch of weekly increases since 2013, and the NASDAQ ended its own 6-week streak.[1] By November 10, the S&P 500 declined 0.21%, the Dow was down 0.50%, and the NASDAQ slipped 0.20%.[2] Meanwhile, the MSCI EAFE dropped by 0.45%.[3]

While these declines are not huge, understanding why stocks dropped after several weeks of steady gains is important. The markets are incredibly complex, so we cannot point to one single detail that drove their performance. We can, however, help you gain insight into what influenced investors' decisions.

The Market's Drop in Context

In many ways, uncertainty is to blame for last week's losses, from a variety of angles:

Healthcare: Equities dropped as companies continue to analyze changing dynamics in the industry, including potential competition from the tech world. Developments on medical devices and healthcare equipment could create quicker distribution models while decreasing costs, threatening traditional business practices.[4]
Energy: Tension between Iran, Saudi Arabia, and Lebanon - and the accompanying geopolitical uncertainty - contributed to crude oil prices slipping, which led Energy stocks to lose ground.[5]
Tax Reform: On Thursday, November 9, the Senate released its tax-reform proposal, which includes significant differences from the current House bill.[6] In particular, the Senate's decision to delay corporate-tax reductions until 2019 led to a stock sell-off. This change from the House bill also fueled concern about the likelihood of fiscal reform moving forward at all.[7]

What Lies Ahead

No one knows exactly when or how taxes may change - and who will experience the greatest impact. For tax reform to occur, the House and Senate will have to work through the number of places where their plans diverge and align their political priorities.[8] At the same time, the Federal Reserve could raise interest rates as many as 4 times over the next year, which could also alter the financial landscape.[9]

In the coming weeks, we will gain more information on tax reform and monetary policy. As we digest information, we will continue focusing on how current circumstances affect clients' long-term goals. As always, if you have questions about your financial life, contact us anytime.

ECONOMIC CALENDAR

Tuesday: PPI-FD
Wednesday: Consumer Price Index, Retail Sales, Business Inventories
Thursday: Industrial Production, Housing Market Index
Friday: Housing Starts

Notes: All index returns (except S&P 500) exclude reinvested dividends, and the 5- year and 10-year returns are annualized. The total returns for the S&P 500 assume reinvestment of dividends on the last day of the month. This may account for differences between the index returns published on Morningstar.com and the index returns published elsewhere. International performance is represented by the MSCI EAFE Index. Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly.

Protect Yourself From IRS Imposters*

Becoming a victim of identity theft can be detrimental to your life, and protecting yourself is essential. Unfortunately, sometimes taxpayers can become deceived by individuals pretending to be IRS representatives through emails, phone calls, or house visits.

Under most instances, the IRS will reach out to you about any tax details by first mailing you an official letter. Sometimes, the IRS may have to communicate in other ways, such as a home visit. When visiting you at home, the IRS representative always shows two official forms of ID, which you have the right to request to see:

Pocket commission
HSPD-12 card

In addition, the IRS will never:

Require a specific type of payment, such as debit card, and ask for your account information over the phone
Insist you pay taxes without the ability to review or appeal the request
Threaten to arrest you or revoke your driver's license or immigration status

Other details may apply, and you can find more information on the IRS website.

* This information is not intended to be a substitute for specific individualized tax advice. We suggest you discuss your specific tax issues with a qualified tax advisor.

Tip courtesy of IRS.gov[11]

Perfect Your Half-Wedge Shot

Approaching half-wedge shots on the course can be tricky. However, by learning to control your distance, you can take wedge shots with confidence.

To practice controlling your distance:

The Swing

1. Use your arms to bring the club back.
2. Turn your body fluidly toward the target on the downswing. Do not try to hit the ball with your hands.
3. Focus on regulating your backswing and through-swing on either side of the ball with 3 different swing lengths.
4. Practice these swings with the same speed and strength, not any harder or softer.

The Wedge

5. Practice each swing length using 3 different wedges.
6. Pay attention to how the various wedges change your distance.

By sequencing your swings and becoming more familiar with your wedges, you can control your distance and hit the half-wedge with purpose.

Tip adapted from Ron Kaspriske | Golf Digest Magazine[12]

Identify Glaucoma Symptoms

Glaucoma is a group of eye conditions in which the optic nerves become damaged and can eventually lead to blindness. Once someone loses their vision to glaucoma, they cannot recover their sight. While anyone can develop glaucoma, it is most common in older adults. Regular eye visits can help keep your vision in check.

Here are some signs you can also look out for:

Open-Angle Glaucoma

Irregular blind spots in your peripheral or central vision, often in both eyes
Advanced tunnel vision

Acute Angle-closure Glaucoma

Pain in your eyes
Intense headaches
Blurry vision
Red eyes

Consult a doctor if you feel you may have any of the above symptoms.

Tip adapted from Mayo Clinic[13]

Keep Your Vegetables From Spoiling

Food waste is a real problem in the United States - each year, we toss out $165 billion worth of uneaten food.[14] You can do your part to not waste edible food by storing it more efficiently. Here are some ways to make your veggies last longer:

Fruit Vegetables

Vegetables like zucchini and cucumber have high moisture, which quickly leads to rot. To lengthen their shelf life:

Rinse only right before you want to use them.
Store them either on a counter or shelf or directly in the refrigerator bin, without a plastic bag.

Root Vegetables

Vegetables such as beets and turnips will dry out and wilt quickly. To lengthen their shelf life:

Cut the tops off each vegetable to avoid pulling moisture away from the root.
Store the topped-off vegetables in an open container covered with a moist towel in the refrigerator (or dunk them in water every few days).

Tip adapted from Care2.com[15]

Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

Diversification does not guarantee profit nor is it guaranteed to protect assets.

International investing involves special risks such as currency fluctuation and political instability and may not be suitable for all investors.

The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general.

The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the NASDAQ. The DJIA was invented by Charles Dow back in 1896.

The Nasdaq Composite is an index of the common stocks and similar securities listed on the NASDAQ stock market and is considered a broad indicator of the performance of stocks of technology companies and growth companies.

The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) that serves as a benchmark of the performance in major international equity markets as represented by 21 major MSCI indices from Europe, Australia and Southeast Asia.

The S&P/Case-Shiller Home Price Indices are the leading measures of U.S. residential real estate prices, tracking changes in the value of residential real estate. The index is made up of measures of real estate prices in 20 cities and weighted to produce the index.

The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.

Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.

Past performance does not guarantee future results.

You cannot invest directly in an index.

Consult your financial professional before making any investment decision.

Fixed income investments are subject to various risks including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications and other factors.

These are the views of Platinum Advisor Marketing Strategies, LLC, and not necessarily those of the named representative, Broker dealer or Investment Advisor, and should not be construed as investment advice. Neither the named representative nor the named Broker dealer or Investment Advisor gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your financial advisor for further information.

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[1] https://www.cnbc.com/2017/11/10/us-stocks-tax-reform-nvidia-earnings.html

[2] http://performance.morningstar.com/Performance/index-c/performance-return.action?t=SPX®ion=usa&culture=en-US

http://performance.morningstar.com/Performance/index-c/performance-return.action?t=!DJI®ion=usa&culture=en-US

http://performance.morningstar.com/Performance/index-c/performance-return.action?t=@CCO

[3] https://www.msci.com/end-of-day-data-search

[4] www.bloomberg.com/news/articles/2017-11-09/asia-stocks-brace-for-volatility-as-dollar-falls-markets-wrap

www.usnews.com/news/business/articles/2017-11-10/most-asian-shares-track-wall-street-losses-on-us-tax-fears

[5] www.bloomberg.com/news/articles/2017-11-09/asia-stocks-brace-for-volatility-as-dollar-falls-markets-wrap

www.bloomberg.com/news/articles/2017-11-10/lebanon-demands-prime-minister-hariri-s-return-from-saudi-arabia

[6] www.npr.org/2017/11/09/563095268/gop-senators-unveil-competing-tax-overhaul

[7] www.bloomberg.com/news/articles/2017-11-09/asia-stocks-brace-for-volatility-as-dollar-falls-markets-wrap

[8] www.nytimes.com/2017/11/09/us/politics/tax-plan-house-senate-differences.html