Prosperity in the Age of Decline and Portfolio Management
You may recognize the title above because our friends Brian and Alan Beaulieu authored a book, Prosperity in the Age of Decline in 2014. You can still purchase the book with this link: https://a.co/d/2sVnANJ.
As the years progress, the data that supports the thesis they spell out in the book continues to get stronger. And ITR Economics continues to update their thoughts. You can find out more information about an upcoming webinar on July 27, 2023, along with some interesting interviews of Brian at: https://itreconomics.com/2030s-great-depression/
Brian, Alan, and all the economists at ITR Economics are not alone when it comes to anticipating rough roads ahead for people. Earlier today I read this article from Bloomberg:
“America’s $7 Trillion Retirement Crisis Is Only Getting Worse”
I am not writing this to shock anyone. But these past several years of investing and changes in the economic landscape have underscored the need for forward-looking portfolio management and planning. Forward-looking portfolio management is quite different than:
Buying a bunch of mutual funds with different names.
Being told it is “time in the market vs. timing the market.”
Holding on to an investment for emotional reasons such as wanting to get those losses back.
Speculating that something that has fallen X% will someday get back to the highs the investment once had.
ITR Economics started the research and development on how the publicly traded markets were impacted when different economic conditions occurred. Bellwether Wealth already had other projects that we engaged in with ITR Economics, and we got to help carry this process further through testing and more research and development through tools we have access to. Bellwether then added machine learning and artificial intelligence to the process (before artificial intelligence was on everyone’s lips.) Brian Beaulieu started calling this the “Optimizer” process during our joint work. We all liked the name and the Optimizer was taken out of research and development and implemented with a few clients’ portfolios in 2019. We rolled it out completely October 1, 2020.
I am retelling this history to illustrate that thought, effort, math and new innovations went into this process that we use for Bellwether Wealth’s brand of portfolio management. The process helps us navigate the complexities of the investment world and manage portfolios for the future. Bellwether has a client whose CPA said our client’s portfolio weathered 2022 remarkably well while most of the CPA’s other clients had double digit losses. I say it all the time, but if we do not lose 50% on a portfolio, you do not need to make 100% to get back to breakeven.
There will be days, months, and even quarters where the Optimizer process lags the S&P 500 as well as other popular benchmarks. However, we look at the bigger picture which has a longer time horizon and bigger implications to someone’s financial health.
We want you to be prepared and to take advantage of events that will continue to keep you financially stable with a long-term view of your wealth growing. We want you, our clients, to prosper.
We do not want you adversely impacted by the events in the articles above. We strive to collaborate with you to avoid traps such as human behavioral biases and emotions that can quickly become quicksand in the investment world.
As always, if you have any questions or concerns, please reach out to me at cbellin@bellww.com.
Clark S. Bellin, CIMA®, CPWA®, CEPA
President & Financial Advisor
Phone: 402-476-8844
E-mail: cbellin@bellww.com
