Ready to break a sweat this fall?

Here are 6 ways to get out, get active and live healthier in Chicago.

At CTS, we believe that a holistic approach to wellness, from financial fitness to physical and mental health, are key elements to living a successful and fulfilled life. And if you’re anything like us, we know that Chicago, with its rich culture and diversity, is the perfect place to get out and explore. Here are six ways to enjoy an active lifestyle in our dynamic city. http://bit.ly/2x3TD4I

Ready to break a sweat this fall?2017-09-28T13:16:31-04:00

Stocks Mixed, Fed Changes Policy

The Weekly Update

Week of September 25, 2017
By Christopher T. Much, CFP®, AIF®

Domestic indexes were mixed last week, as the Dow gained 0.36%, the S&P 500 eked out a 0.08% increase, and the NASDAQ lost 0.33%. International stocks in the MSCI EAFE added a solid 0.68%.

Three stories that have dominated conversations and driven investor attention in 2017 continued last week:

  • Healthcare policy: The Senate’s continuing discussion of healthcare reform impacted stock performance in connected industries.
  • Tension with North Korea: The markets responded quietly to continuing conflict between President Trump and Kim Jong Un, although some investments saw a bump later in the week.
  • Interest rate updates: While the Fed chose not to raise interest rates in its most recent meeting, it indicated that a December hike is definitely still on the table.

When announcing its latest interest rate perspectives, the Federal Reserve also indicated that it would begin to reduce its balance sheet next month.

But, what does that really mean—and why does the Fed have a $4.2 trillion balance sheet, anyway?

A Look Back on Quantitative Easing

During the financial crisis and recession, the Fed took an unprecedented and controversial approach to stabilizing our economy and the world’s markets. By buying trillions of dollars of Treasury and mortgage bonds between 2008 and 2014, it aimed to encourage hiring, economic growth, and investing. This action is commonly known as Quantitative Easing (QE).

Through the three rounds of QE, the Fed added trillions of dollars of new money to the financial markets. Since QE first began almost a decade ago, we have seen unemployment reach a 16-year low and the S&P 500 more than triple from its bottom in 2009. Although economic growth is still slower than before the recession, the Fed believes the economy is now strong enough to handle more normal monetary policy.

In October, the Fed will start the gradual process of lowering its balance sheet—currently equal to about a quarter of Gross Domestic Product (GDP). Thus far, investors have had a mild response to this plan. As the Fed begins slowly allowing billions of dollars of bonds to roll off, we will closely monitor the economic impact.

We know that monetary policy can seem like an incredibly complex topic—and, frankly, it is. However, we think you deserve to understand the large forces at play in your financial life. If you have any questions about the Fed’s latest announcement, or any other financial details, we’re always here to talk.

ECONOMIC CALENDAR
Tuesday: New Home Sales, Consumer Confidence
Wednesday: Durable Goods Orders
Thursday: GDP
Friday: Personal Income and Outlays, Consumer Sentiment

Past performance is no guarantee of future results. Data collected from Investors FastTrack software.
http://performance.morningstar.com/Performance/index-c/performance-return.action?t=!DJI&region=usa&culture=en-US
http://performance.morningstar.com/Performance/index-c/performance-return.action?t=SPX&region=usa&culture=en-US
http://performance.morningstar.com/Performance/index-c/performance-return.action?t=@CCO
https://www.msci.com/end-of-day-data-search
https://www.cnbc.com/2017/09/22/us-stocks-open-lower-as-geopolitics-tensions-heat-up-after-north-korean-threat.html
https://www.reuters.com/article/us-usa-fed/fed-keeps-u-s-rates-steady-to-start-portfolio-drawdown-in-october-idUSKCN1BV0GJ
https://www.reuters.com/article/us-usa-fed/fed-keeps-u-s-rates-steady-to-start-portfolio-drawdown-in-october-idUSKCN1BV0GJ
http://fingfx.thomsonreuters.com/gfx/rngs/USA-FED/010050VD1YM/index.html
https://www.bloomberg.com/news/articles/2017-09-20/can-the-fed-unwind-without-unnverving-markets-quicktake-q-a
http://fingfx.thomsonreuters.com/gfx/rngs/USA-FED/010050VD1YM/index.html
https://www.bloomberg.com/news/articles/2017-09-20/can-the-fed-unwind-without-unnverving-markets-quicktake-q-a
Stocks Mixed, Fed Changes Policy2017-09-25T15:41:20-04:00

Understanding Record Highs

The Weekly Update

Week of September 18, 2017
By Christopher T. Much, CFP®, AIF®

After briefly stumbling the week of September 4, domestic indexes notched significant gains last week and hit record highs. By Friday, the S&P 500 exceeded 2,500 for the first time, the Dow closed at its highest level ever, and the NASDAQ reached an intraday record. Each of the indexes gained well over 1% for the week, with the S&P 500 adding 1.58%, the Dow jumping 2.16%, and the NASDAQ increasing 1.39%. International stocks in the MSCI EAFE also performed well, with a weekly gain of 0.55%.

When looking at these sizable increases, you might expect that positive data and geopolitical calm filled the news last week. Instead, we experienced a number of occurrences that could have derailed stock performance:

  • North Korea tested another missile
  • London experienced a terrorist attack
  • Industrial production declined in August
  • Retail sales fell in August

So, why did stocks rise despite these less-than-stellar updates?

Of course, it goes without saying that the markets are incredibly complex. You can rarely, if ever, point to a single reason for their performance. Still, a few details may help put this week’s seemingly incongruous gains into perspective.

  1. Investors mostly ignored North Korea and the London bombing.
    Rather than running to less volatile investments after both geopolitical events, typical havens actually declined. After over a dozen North Korean missile tests and multiple London terror attacks this year, investors may simply be feeling complacent about these occurrences. Instead, many are looking to the Fed’s meeting this week as a market catalyst.
  2. Weather affected industrial production and retail sales.
    Hurricane Harvey likely pushed down both industrial production and retail sales in August, meaning these data-declines may be temporary. In addition, mild weather on the East Coast meant less air conditioner use—decreasing utility output for industrial production.
  3. The Consumer Price Index (CPI) jumped.
    After missing expectations for five months in a row, the CPIa measure of inflationbeat estimates for August. If upcoming months continue this positive performance, which the hurricanes make more likely, the Federal Reserve may be more likely to raise interest rates in December.

What is on the horizon?

Hurricanes Harvey and Irma could continue to affect economic data in the fourth quarter by driving down retail sales and increasing the Consumer Price Index. We may need to wait a few months before we can see the true trends underlying the data. For now, we will continue to track market performance and investor sentiment, and seek out accurate information amidst the hype.

ECONOMIC CALENDAR
Monday: Housing Market Index
Tuesday: Housing Starts
Wednesday: Existing Home Sales, FOMC Meeting Announcement
Friday: PMI Composite Flash

Past performance is no guarantee of future results. Data collected from Investors FastTrack software.
https://www.cnbc.com/2017/09/15/us-stocks-weekly-gains-fed-retail.html
http://performance.morningstar.com/Performance/index-c/performance-return.action?t=SPX&region=usa&culture=en-US
http://performance.morningstar.com/Performance/index-c/performance-return.action?t=!DJI&region=usa&culture=en-US
http://performance.morningstar.com/Performance/index-c/performance-return.action?t=@CCO
https://www.msci.com/end-of-day-data-search
https://www.bloomberg.com/news/articles/2017-09-14/yen-jumps-after-report-of-north-korea-missile-markets-wrap
https://www.cnbc.com/2017/09/15/us-stocks-weekly-gains-fed-retail.html
https://www.bloomberg.com/news/articles/2017-09-14/yen-jumps-after-report-of-north-korea-missile-markets-wrap
http://www.reuters.com/article/us-usa-stocks/wall-street-hits-record-highs-sp-500-pierces-2500-idUSKCN1BQ1HK
http://www.ftportfolios.com/Commentary/EconomicResearch/2017/9/15/industrial-production-declined-0.9percent-in-august
http://www.ftportfolios.com/Commentary/EconomicResearch/2017/9/15/retail-sales-declined-0.2percent-in-august
https://www.bloomberg.com/news/articles/2017-09-14/u-s-inflation-picks-up-ending-five-month-streak-of-misses
http://www.ftportfolios.com/Commentary/EconomicResearch/2017/9/15/retail-sales-declined-0.2percent-in-august
http://www.ftportfolios.com/Commentary/EconomicResearch/2017/9/14/the-consumer-price-index-rose-0.4percent-in-august
http://www.chicagotribune.com/business/ct-equifax-data-breach-0917-biz-20170915-story.html
Understanding Record Highs2017-09-19T10:16:33-04:00

Giving Back with Planned Philanthropy

What part does philanthropy play in planning a lasting legacy?

At CTS, we understand that success in life is about more than amassing wealth. It’s about the conscious legacy you leave behind for your loved ones, community, and society – the lives you’ve touched or perhaps even changed. We created this special article to share what we believe are some of the financial and social benefits of a proactive approach to philanthropy. http://bit.ly/2xKMN3c

Giving Back with Planned Philanthropy2017-09-14T10:09:04-04:00

Could Weather Cause Headwinds?

The Weekly Update

Week of September 12, 2017
By Christopher T. Much, CFP®, AIF®

Last week, the markets closed for Labor Day, and in the subsequent four trading days, all three domestic indexes gave back some recent gains. The S&P 500 declined 0.61%, the Dow lost 0.86%, and the NASDAQ slid 1.17%. International stocks in the MSCI EAFE faired better, ending Friday up 0.78% for the week.

On Wednesday, September 6, we received solid data from the services sector, with the ISM Non-Manufacturing Index showing growth in 15 of the 18 industries it tracks. The trade deficit also stayed relatively static for July, avoiding the widening trade gap forecasters predicted. Both reports may indicate that the economy continues to be on stronger ground than many people believe.

But last week’s new economic reports were not what drove many headlines or captured people’s attention. Between Hurricane Harvey’s devastation in Texas and Louisiana, Irma bearing down on Florida and the Southeast, and new hurricanes Jose and Katia forming offshore, weather was on everyone’s minds. Understanding the economic effects these weather events can create is important for proactively planning ahead.

How Hurricanes Affected the Markets

  • Insurance Companies Stumbled—Then Recovered
    Large natural disasters can be incredibly costly for insurance companies. Last week, despite Friday’s price recovery, many insurance stocks and ETFs lost considerable ground, as investors contemplated whether insurers would be able to withstand the costs of Hurricanes Harvey and Irma.
  • Materials Suppliers Jumped
    While hurricanes are challenging for insurers, they can drive growth for companies who will help provide materials when rebuilding begins. With Hurricane Irma predicted to “devastate” areas of the U.S., a number of building suppliers added over 1% to their stock prices on Friday.
  • Restaurant Stocks Struggled
    Several major restaurant brands saw their stock prices drop last week. Restaurants with a large number of locations in hurricane-damaged areas could experience lower sales throughout the rest of 2017.

What to Expect for Long-Range Impacts

With Hurricane Irma battering the southern states and Harvey’s waters still receding, we are far from knowing the final tally of either hurricane’s destruction. However, some estimates indicate that recovery could cost as much as $100 billion or more—for each storm.

Due to these massive recovery efforts, natural disasters like this can end up having a net-positive effect on the economy. Ultimately, industries such as construction, transportation, and logistics often benefit from rebuilding. Meanwhile, industries such as insurance and hospitality may suffer due to the losses they experience.

While the costs from damages will be immense, the true economic impact will be important to track as the weather events continue. In the meantime, we also believe that paying attention to the human side of weather catastrophes is just as important. We send our thoughts and best wishes to everyone affected by these storms, and we hope for as swift a recovery as possible.

Should you have any questions or concerns about how severe weather events could affect your financial future, we are always ready to talk.

ECONOMIC CALENDAR
Tuesday: JOLTS
Wednesday: PPI-FD
Thursday: Consumer Price Index
Friday: Retail Sales, Industrial Production, Business Inventories, Consumer Sentiment

Past performance is no guarantee of future results. Data collected from Investors FastTrack software.
http://performance.morningstar.com/Performance/index-c/performance-return.action?t=SPX&region=usa&culture=en-US
http://performance.morningstar.com/Performance/index-c/performance-return.action?t=!DJI&region=usa&culture=en-US
http://performance.morningstar.com/Performance/index-c/performance-return.action?t=@CCO
https://www.msci.com/end-of-day-data-search
http://www.ftportfolios.com/Commentary/EconomicResearch/2017/9/6/the-ism-non-manufacturing-index-rose-to-55.3-in-august
http://wsj-us.econoday.com/byshoweventfull.asp?fid=477703&cust=wsj-us&year=2017&lid=0&prev=/byweek.asp#top
https://www.cnbc.com/2017/09/08/stocks-lower-insurers-decline-on-irma-risk.html
https://www.cnbc.com/2017/09/08/here-are-the-restaurants-that-will-be-hit-hardest-by-hurricane-irma.html
https://www.cnbc.com/2017/09/08/stocks-lower-insurers-decline-on-irma-risk.html
https://www.cnbc.com/2017/09/06/hurricane-irma-cost-could-hit-125-billion-or-double-credit-suisse.html
https://www.nytimes.com/interactive/2017/09/01/upshot/cost-of-hurricane-harvey-only-one-storm-comes-close.html?mcubz=0
http://www.marketwatch.com/story/wall-street-stocks-set-for-losses-as-life-threatening-irma-aims-for-florida-2017-09-08
http://www.marketwatch.com/story/what-history-says-about-hurricane-irma-and-the-stock-market-2017-09-08
Could Weather Cause Headwinds?2017-09-12T12:46:10-04:00

The Economy Picks Up Speed

The Weekly Update

Week of September 5, 2017

By Christopher T. Much, CFP®, AIF®

Last week gave a number of things for both investors and non-investors to think—and worry—about. From North Korea’s missiles to Hurricane Harvey’s devastation to an unemployment uptick, the headlines were busy. Yet, despite these circumstances, U.S. stocks posted gains again this week—and the NASDAQ ended Friday with a new record high and 2017’s best weekly performance. Overall, the S&P 500 added 1.37%, the Dow was up 0.80%, the NASDAQ gained 2.71%, and the MSCI EAFE increased by 0.55%.

So, what did we learn about the economy last week that helped contribute to these gains?

Big News: GDP Hits 2-Year High

On August 30, the Commerce Department released its second reading of Q2 Gross Domestic Product. After sluggish growth in the first quarter of 2017, consumer and business spending helped advance our economy in April through June. In fact, the revised reading increased to a 3% annual growth rate, which beat expectations and represented the fastest growth since Q1 of 2015.

As we predicted in last week’s market update, larger core durable goods orders contributed to this positive GDP report.

Solid Support: Manufacturing Index Jumps

The Institute for Supply Management’s manufacturing index, which measures business expansion or contraction, reached a 6-year high in August. According to Economist Andrew Hunter, this growth spike could generate GDP growth as high as 4% in the third quarter. That pace would be far above the average during the current economic recovery and would mean the economy is growing more quickly than many people expected.

Of course, we are still in Q3, and any number of details could affect economic growth. We have many important happenings on the horizon that the markets will be watching, including debt-ceiling decisions, tax-reform outcomes, and much more. However, recent data indicates that both consumers and businesses are opening their wallets—and the economy is growing. After 9 years of economic recovery where growth has often been lackluster, this quickening pace is welcome news.

Looking ahead, we will continue to focus on uncovering the best opportunities for your long-term goals. As more data and insight come in, we will keep you informed every step of the way.

ECONOMIC CALENDAR
Monday: U.S. Markets Closed for Labor Day
Tuesday: Factory Orders
Wednesday: ISM Non-Mfg Index
Thursday: Productivity and Costs, Bloomberg Consumer Comfort Index

Past performance is no guarantee of future results. Data collected from Investors FastTrack software.
https://www.cnbc.com/2017/09/01/us-stocks-jobs-report-disappoints.html

http://performance.morningstar.com/Performance/index-c/performance-return.action?t=SPX&region=usa&culture=en-US

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

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

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

https://www.nytimes.com/2017/08/30/business/economy/gdp.html

https://www.cnbc.com/2017/08/30/us-revised-second-quarter-gdp.html

http://wsj-us.econoday.com/byshoweventfull.asp?fid=477410&cust=wsj-us&year=2017&lid=0&prev=/byweek.asp#top

https://www.cnbc.com/2017/09/01/ism-indicator-shows-economy-may-be-growing-above-4-percent-now.html

https://www.zacks.com/commentary/126684/stock-investing-strategy-when-at-all-time-highs

https://www.nytimes.com/2017/08/30/business/economy/gdp.html

The Economy Picks Up Speed2017-09-05T14:43:00-04:00