Me personally, I am a maximizer. Always wanting more improvement on my body (yet cheating on my diet), wanting more money in the bank (yet spending too much on Amazon purchases), wanting a bigger house (yet when we got one, complaining about how it doesn’t feel like home), and on and on and on. This kind of personality has been a benefit in helping me achieve what I have achieved in business, in growth personally, in achievements materially, but it has a some BIG GNARLY DRAWBACK(s). I am never satisfied with what I have now, content with taking vacations, being in the moment or relaxing—and this I am working on but have yet to “achieve it.”
A satisficer is someone I wish I could be but sadly, am not. Those co-workers who are happy being who they are and where they are in life. They may seem without ambition or goals, but in reality, they have those goals, they just do not allow those goals to get in the way of being satisfied with where they are and who they are. For these individuals, they have a high quality of life and enjoy their lives immensely. For us maximizers, we have a high level of achievement and the stress that accompanies it but do not have the highest quality of life—not because we cannot afford it, but more because we do not recognize that having more for the sake of more is not the answer. What we are chasing is impossible to achieve so we must be reminded of where we came from—a previous version of ourselves. We need reminded that everything will be okay. When we do not outperform, everything will be okay. When we are still chubby after working out for a week, everything will be fine. When we do not always think we are good enough, we are in fact better than we feel.1,2,3
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Why would I write about this?
Because many investors may say they are satisficers and feel like or live like they are content, but when it comes to investing, they behave like maximizers, and like I said before, maximizers want more and when they are asked why…they cannot say. But more sounds better and better must be what everybody wants, and they want that too!
Your update call happens in May and your investments are trailing the S&P 500 by 1.5% or 3.5% or 5%, and that voice in your head begins to get louder saying… “We have to do something about this situation or it’s going to get worse,” and so you do. You make a change in your investment strategy, you sell some of your holdings, or you even fire your advisor and start the search for someone “better.” Whenever I hear the sentence “I have bad luck with…women, cards, cars, dating, etc.…” my internal reply is always the same. “Maybe it’s you and not the “women, cards, cars, dates, etc.” that is the problem!”
We lost a client last year for “lack of performance.” When I was speaking with them about their choice to leave, they said, “we expected more.” My response was, we raised you over $1 million in gains in the last 4 years, and that is better than you had in the past. You are not even going to spend it all, so why was that not enough? We both agreed that it was a great idea for them to find someone else.
We all have a little maximizer in us. We all have a little satisficer in us too depending on the area of our lives we are speaking about. The key to happiness is knowing when to put that maximizer mentality in its rightful place and let the satisficer take the lead and enjoy a quality of life you are working so hard to get. Let’s face it…none of us are getting out alive, so why are we not enjoying the fruits of our labor while we can!?
Till we speak again, enjoy your week, and try to relax a bit and smell the flowers before they are gone!
Barry Schwarts, “Doing better but feeling worse: The Paradox of Choice”
The paradox of Choice: Why more is less by Barry Schwartz
Overcoming a COVID-related economic growth scare, stocks moved higher amid a week of strong corporate earnings reports.
The Dow Jones Industrial Average rose 1.08%, while the Standard & Poor’s 500 gained 1.96%. The Nasdaq Composite index soared 2.84% for the week. The MSCI EAFE index, which tracks developed overseas stock markets, dipped 0.20%.1,2,3
Delta Variant Head Fake
Stocks staged a broad retreat on Monday as traders worried about the adverse economic implications of growing Delta variant infections. Economically sensitive sectors, such as energy, financials, industrials, and materials, absorbed the brunt of Monday’s sell-off.
But the markets did a quick about face, posting four-consecutive days of gains and leaving the three major averages with fresh record highs.4
The sharp reversal may be attributable to a “buy on the dip” investor mentality, the absence of investment alternatives to stocks in this low interest rate environment, and massive financial liquidity. Stocks were also lifted by a healthy kick-off to the second quarter earnings season.
The earnings season moved into full swing last week, and the results exceeded the market’s high expectations.
Of the 120 companies in the S&P 500 index that have reported as of Friday, July 23, 89% of them beat the Street’s earnings-per-share estimates by, on average, 20.6%. Financials and Consumer Discretionary sectors provided the biggest earnings surprises (+28.9% and +24.5%, respectively), while Materials and Utilities delivered the smallest positive surprises (+5.3% and +2.5%, respectively).
These earnings beats are leading Wall Street analysts to raise earnings estimates for 3Q 2021 through 1Q 2022.5
The National Bureau of Economic Research said last week that the pandemic-induced recession ended in April 2020, officially lasting two months and making it the shortest recession in U.S. history.6
Wednesday: FOMC (Federal Open Market Committee) Announcement.
Thursday: GDP (Gross Domestic Product). Jobless Claims.
Source: Econoday, July 23, 2021The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.
This Week: Companies Reporting Earnings
Monday: Tesla (TSLA), Lockheed Martin (LMT).
Tuesday: Apple, Inc. (AAPL), Microsoft Corporation (MSFT), General Electric (GE), Advanced Micro Devices, Inc. (AMD), Visa (V), Alphabet, Inc. (GOOGL), Starbucks Corporation (SBUX), 3M Company (MMM), United Parcel Service, Inc. (UPS), Mondelez International (MDLZ).
Wednesday: Facebook, Inc. (FB), The Boeing Corporation (BA), Qualcomm, Inc. (QCOM), Bristol Myers Squibb (BMY), Paypal Holdings (PYPL), Pfizer, Inc. (PFE), McDonalds Corporation (MCD), Shopify, Inc. (SHOP), Servicenow, Inc. (NOW), Thermo Fisher Scientific, Inc. (TMO).
Thursday: Amazon.com, Inc. (AMZN), Ford Motor Company (F), Mastercard (MA), Twilio, Inc. (TWLO), Merck & Company (MRK), The Southern Company (SO), Northrop Grumman (NOC), Comcast Corporation (CMCSA), AnheuserBusch InBev (BUD), Abbvie, Inc. (ABBV).
Friday: Exxon Mobil Corporation (XOM), Caterpillar, Inc.(CAT), Chevron Corporation (CVX), Procter & Gamble (PG), Charter Communications, Inc. (CHRT).
Source: Zacks, July 23, 2021Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.
“If you have passion, a chip on the shoulder, a sense of humor, and you can explain what you do very well, it doesn't matter if you're a plumber or a singer or a politician. If you have those four things, you are interesting.”
– Larry King
Think About Credits and Deductions Now to Prepare for Filing
Here are a few facts about credits and deductions that can help you with year-round tax planning:
Taxable income is what’s left after someone subtracts any eligible deductions from their adjusted gross income, including the standard deduction. Some taxpayers may choose to itemize their deductions to lower their adjusted gross income.
The Tax Cuts and Jobs Act made changes to itemized deductions. In comparing these changes, many individuals who used to itemize may find it more beneficial to take the standard deduction.
As a general rule, if a taxpayer’s itemized deductions are larger than their standard deduction, they should itemize. Depending on the situation, some taxpayers may even be required to itemize.
Taxpayers may be able to subtract tax credits from the total amount of tax they owe. To claim a credit, taxpayers should keep records that show their eligibility for it. Some major tax credits include the child tax credit and the child and dependent care credit, the American opportunity credit or lifetime learning credit, and the earned income tax credit.
* This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax professional.
Tip adapted from IRS.gov7
Macro Dieting is a New Way to Approach Calorie Counting
Macro dieting is a diet that goes a step further than just basic calorie counting. Instead of counting just the number of calories, you count the macronutrients, including proteins, carbs, and fats. How much of each macronutrient you need depends on your body type, goal, lifestyle, and activity level. Rather than depriving your body of nutrients, you are instead focusing on meals that give your body the nutrients it needs to be more efficient.
To start a macro diet, you first need to calculate how many grams of each macro you should be eating. A standard breakdown is 50-25-25, meaning 50% of your calories come from carbs, 25% come from protein, and 25% from fat. But, this breakdown will depend on your goals. For example, if you are focusing on strength training you may want to eat more protein.
Tip adapted from Cooking Light8
When can you add two to eleven and get one as the correct answer?
Last week’s riddle: If you were running a race, and you passed the person in 2nd place, what place would you be in now? Answer: 2nd place.
Spawning sockeye salmon in the Adams River, British Columbia, Canada.
Footnotes and Sources
1. The Wall Street Journal, July 23, 2021
2. The Wall Street Journal, July 23, 2021
3. The Wall Street Journal, July 23, 2021
4. CNBC, July 23, 2021
5. Earnings Scout, July 23, 2021
6. The Wall Street Journal, July 19, 2021
7. IRS.gov, February 21, 2021
8. Cookinglight.com, January 9, 2019
Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost.
The forecasts or forward-looking statements are based on assumptions, may not materialize, and are subject to revision without notice.
The market indexes discussed are unmanaged, and generally, considered representative of their respective markets. Index performance is not indicative of the past performance of a particular investment. Indexes do not incur management fees, costs, and expenses. Individuals cannot directly invest in unmanaged indexes. Past performance does not guarantee future results.
The Dow Jones Industrial Average is an unmanaged index that is generally considered representative of large-capitalization companies on the U.S. stock market. 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 technology and growth companies. The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) and serves as a benchmark of the performance of major international equity markets, as represented by 21 major MSCI indexes from Europe, Australia, and Southeast Asia. The S&P 500 Composite Index is an unmanaged group of securities that are considered to be representative of the stock market in general.
U.S. Treasury Notes are guaranteed by the federal government as to the timely payment of principal and interest. However, if you sell a Treasury Note prior to maturity, it may be worth more or less than the original price paid. 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.
International investments carry additional risks, which include differences in financial reporting standards, currency exchange rates, political risks unique to a specific country, foreign taxes and regulations, and the potential for illiquid markets. These factors may result in greater share price volatility.
Please consult your financial professional for additional information.
This content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. Please consult legal or tax professionals for specific information regarding your individual situation. This material was developed and produced by FMG Suite to provide information on a topic that may be of interest. FMG is not affiliated with the named representative, financial professional, Registered Investment Advisor, Broker-Dealer, nor state- or SEC-registered investment advisory firm. The opinions expressed and material provided are for general information, and they should not be considered a solicitation for the purchase or sale of any security.
Copyright 2021 FMG Suite.
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