Podcast Episode - What You Need to Do in 2022

Credit Union, Financial Security, Investing, Stock Market, Stocks

January 09, 2022

Listen to Podcast Episode:

Suze is back and takes us to Suze School. Learn what’s happening with the market, stocks you might want to buy when the time is right. crypto and an economic lesson.

Podcast Transcript:

January 9, 2022. Well, as you can tell, my voice is still not quite back. But I'm going to really try to get through this particular podcast because there's so much that I need to tell all of you. First, thank you for all the well wishes for my voice. It's coming back slowly. This is an incredible improvement. But we'll just see how it goes. But even though my voice maybe coming back slowly, what's happening in the economy and the stock market and crypto is happening very, very rapidly. So, I'll talk about all that in a second and give you some investment names and things like that to consider. But first, I hope you understand now why I've been telling you to have cash and savings is probably the wisest investment you could have had, especially at moments like this. But I want to say one thing right now. It was one year ago actually, tomorrow that we announced what I know is the absolute most incredible offer we have ever made on the Women & Money Podcast. And that was the offer from Alliant Credit Union where not only were they paying you 0.55% on your money in terms of interest, but they were also offering $100 bonus. If you just simply followed a few simple rules. Now, thousands of you took advantage of this offer and thousands of you now have received not only one of the highest interest rates offered on savings accounts, but $100 bonus as well. So, I couldn't be happier. I have to tell you that Alliant Credit Union has agreed to extend that offer for new people. People who did not take advantage of it for whatever reason. Out for those of you who did know you're not going to get another $100 but I want you to keep saving because as interest rates go up if banks and credit unions raise interest rates, I'm telling you Alliant will be one of the very first ones to do so. And, don't be surprised at the end of this year. Again, when we might be able to offer another $20,000 sweepstakes that those of you who have been saving have accounts, you'll be able to take advantage of more entries into that sweepstakes. So just once again for those of you who don't know, let me explain to all of you how this offer from Alliant Credit Union happens to work. All you have to do, and I want every single one of you that hasn't done it. I want every single one of you that already has this account to tell as many people about it as possible. All you have to do is go to my MyAlliant.com. That's MYALLIANT.com and just commit to depositing at least $100 a month for 12 consecutive months. It is not that hard people if you do that. Not only will you get the 0.55% interest rate, but you will also get that $100 bonus at the end of 12 consecutive deposits. You have to open your account. It doesn't cost you anything to do it whatsoever. You have to fund it immediately within 30 days and just keep doing it. It is just that simple. If all you put in was $100 a month for 12 consecutive months, you earned just 0.55% interest and you got that $100 bonus that's like a 16% return on your money. Are you kidding me? And if we get to offer the sweepstakes again, you will be automatically entered. Now five people won a total of $20,000 at the end of last year. Can't you use that money? Who else is giving you that opportunity? So, I am asking you all to go to MyAlliant.com if you haven't already done so and this is the month start right now. So that at the end of this year you can get that bonus and possibly win thousands of dollars if we get to offer the sweepstakes again. Now, I don't know how long Alliant’s going to allow us to do this. So, you have got to take advantage of it. Remember it was only supposed to be for a few months last year and then we got them to extend to the end of the year and now they're doing it again. So, I am asking you don't take this offer for granted and do it. All right, Let's talk about what the heck is happening now in the economy. And I really think to understand what's happening, you have to know what happened and go all the way back to like 2020, 2019, because it's important that you understand why things happen, not just what to do, but why you are doing that which I want you to do. So, let's go back to 2019, 2020. The pandemic hits. So, the government created all these programs that gave Americans all this money as they were staying at home, which gave you all this enormous spending power at the same time. There was really no place for you to spend that money. Why was that? Because you were in lockdown, other than buying goods, not services, but goods, where were you going to spend it? You couldn't go out to eat, you couldn't travel, you couldn't get in your car, you couldn't go to hotels, you couldn't do anything. So, what did you all start to do with all this extra money? You started to buy things. When you bought things and more and more things that totally overwhelmed all the supply chains. They weren't prepared for the onslaught of all the Amazon orders, Etsy orders. They just weren't prepared at the same time. You had energy now. Energy affects everything. And when I say energy, I mean oil, I know I know a lot of you don't like when I talk about oil, but oil really is still and I hope it isn't always but really is the foundation of transportation and how things move and how things are made. And if you remember back in April of 2020, I said to all of you now, this may be the worst call I've ever made. But I want you to buy XLE. Now XLE is the ETF for oil. And it was at that exact time right around there when crude and crude is what oil is made of, crude oil dropped 306%. And do you remember that oil was trading at a negative $37 a barrel? And what that means to all of you is that they were paying people $37 a barrel to take oil off their hands. So rather than suppliers paying for oil, the people manufacturing the oil, we're paying the suppliers to say here, I'll pay you $37 a barrel to take it off my hands. And again, the reason that happened, everything came to a stop. No one was using oil, nobody was flying, No one was driving, no cruises, nothing. So, there was too much oil being produced and not enough being consumed and there was no place to store it. So, at the same time this was happening Saudi Arabia and Russia, they were engaged in this price war, which didn't help at all. So now we have oil that was totally negative at $37 a barrel. You have to understand that almost everything we consume the plastic containers, the food that our food comes in, everything is somehow produced with oil. So then what happened is as the pandemic started to loosen up and all of you were able to go out and consume again. You were all set free. You all went to football games, and basketball games, and baseball games, you all started to travel, there were lines at the airports, everything you started to consume all these services again travel. But there was a lack of everything, there wasn't anything there anymore. There wasn't enough oil, there wasn't enough goods on the shelf, there wasn't enough, they thought for Christmas, all this stuff. And because there was a lack of everything that started to push prices up more and more simply to catch up with demand, which has led us to one of the highest inflation rates many of you have ever experienced in your lives. Now, that's just a brief explanation of essentially what has happened. And then we enter the stock market. Now, here's what you have to understand about the stock market. For years now, essentially, starting in about 2008, 2009, 2010. When we went through that financial crisis, the feds started to do, what was called quantitative easing, where they pumped money into the system and the way they pumped money into the system to keep everything afloat was to buy bonds. And when they bought bonds that put a lot of money into the economy. And what's interesting about that is the reason why the government does, that isn't really to help everybody. It's so it stimulates the economy so that everything looks good for them. So, for instance, when they pump money into the economy, they buy bonds that causes the price of bonds to go up. But the yields of bonds to go down. So, everything you could buy or when you wanted to borrow money, it was almost at a 0% interest rate. So, what did you all do? You went out and you bought homes, you went out and you bought new cars, you went out to buy all of these things, which spurred the economy on and it spurted on so much at the exact same time when the supply chains were all crowded, that there wasn't enough cars for you to buy. The price of cars went up incredibly. Homes went up incredibly because there wasn't enough supply on the market. It did everything that it was supposed to do, which was push up prices because why you were buying more things. The other reason, however, that they did that in my opinion is that when interest rates go so low down to essentially nothing. You don't want to keep your money in savings accounts anymore. What do you want to do with your money? You almost are forced into taking that money and putting it into the stock market, which this may not be a popular belief, but I believe is the true goal of quantitative easing because stock prices rose as interest rates decreased and a stock prices increased, all of you felt wealthier, you felt more confident and you're spending increase which spurred on the economy. Like when you look at your 401 K. statements and your stock portfolios and all these things, you see how much money you have, but you don't have that money until you sell those stocks. Do you understand that everybody? You felt so wealthy. So, you bought homes that were far more expensive than you probably could afford because interest rates were so low, you wanted to take advantage of it. You were afraid that if you didn't buy real estate right away, oh my God, you would never get in on the increase of 20% a year when you buy real estate, what do you do? You also renovate the real estate? You build more, you do things like that, causing lumber and everything to skyrocket as well. But the problem is now because the feds did that inflation has absolutely gone out of control. Now they all told us it was going to be temporary, didn't they? And didn't I tell you know, it's not, which is why I wanted you to buy and still do series I bonds because I think that interest rate is going to hold for a while. Alright. So money that you're going to lock up for the long term series I bonds right now money that you need and you may need within a year, two or three, you have got to take advantage of the account at Alliant Credit Union again to go to MyAlliant.com. If you just go to Alliant Credit Union directly, you're not going to get that account by the way it is called the ultimate opportunity savings account. I created it with them. Look for my picture. All right. So, when the feds finally realized that inflation is here to stay for a while, they announced that starting in March of this year, they were going to start to raise interest rates. Uh oh, they're going to start to raise interest rates for the first time in tenants some odd years. What does that do? It scares people, it scares people who invest in the stock market because why invest in the stock market when maybe you can get 2, 3, 4, 5% again in interest rates in treasuries or savings or whatever it may be. So as soon as they announced that and with the onset of Omicron, the new variant of the COVID virus, the stock market freak because the stock market doesn't like when interest rates go up. And so, what happened is bam the market got obliterated especially in technology which many of you were invested in. Now, I have tried to tell you to stay diversified. Haven't I? Haven't I said over and over again that I want you to buy the vanguard total stock market index fund symbol VTI The Vanguard Aristocrats Fund which is the most consistent 25 years of dividend paying stock symbol NOBL. I've told you to buy SPY and things like that, to be diversified. And the truth is, if you have listened to me you wouldn't have been so hurt. Let me just give you an example. So, these are closes as of January 7th, 2022. VTI closed at 236. It's high was 244. You'd only be down 3.3% from its high. Noble the symbol NOBL for the aristocrats fund high was 99.75. It's at 98. You'd be at 1.75. The SPY the 500 index high was 480. It was at 466 on Friday you'd be down 2.9%. The Standard and Poor's Dividend Fund symbol SPY right. High was 132. It's at 130 you wouldn't be down. XLE which I asked again all of you to buy. High was 61.50. The closes 61 you wouldn't be done at all. I also told all of you, I thought you should buy Chevron. The high was 126. It's at 125. Last Friday you wouldn't be down. Now I did also tell all of you to buy ark ARKK. Cathie Wood's Exchange Traded Fund which is all tech technology. High was 160. It's at 84. That's a 48% loss. I get that everybody that is why diversification is key. If you had just purchased all these things or stocks that were totally diversified, you would not have been hurt that much overall because all these other ETF’s pay a very high dividend as well. So, what are people looking for right now when it comes to the stock market, they are looking for dividend paying stocks. They're looking for stocks that actually have earnings, they make money, they're not looking for stocks anymore that are projected five years from now they're going to be fabulous. They want to know the companies right now are making money. Many people are looking at stocks like AT&T. Currently pays an 8% dividend after their merger, it will cut it to about 4%, big deal. They're looking at Ford, CVS Verizon, IBM, Three M, JPMorgan, Fizer, Digital Reality. Now a lot of the stocks that I just mentioned are paying dividends. For instance, CVS is paying 2.11% and dividends. Verizon 4.76%. IBM 4.87%. Three M, symbol is MMM, is 3.29%. JPMorgan is 2.42%. Digital Reality, symbol DLR, 4.88%. Fizer 2.92%. That's where a lot of people are going out. If you are looking for income, you're looking for safety. Okay. You might want to look at some of those stocks. Remember if you buy individual stocks, you should be buying at least 25 stocks knowing that you're going to hold them for a while. Again, that's possible. Especially if you have an account opened somewhere where they allow you to buy slices of stock because some of these stocks are expensive. So, if you want to put $50 in each one of these, you could, if you wanted to. However, with that said, many of you are still wanting technology stocks and technology stocks have absolutely been obliterated seriously. I own a lot of technology stocks, but here's the problem when stocks that are fabulous stocks get obliterated, you run away from them versus possibly thinking, oh maybe I'll just start to invest in them now. Now is not quite the time, but stocks like Upstart, Crowd Strike, The Trade Desk, Shopify, Snowflake, Airbnb, what are a few others I can think of. Lemonade, PayPal, Discovery, Pay Come, and the list goes on and on. They are stocks again if you have at least five years and you can buy at least 25 of these kinds of companies. Great now maybe you don't want to do that. Maybe you don't want to pick out individual companies. That's where ETS like Arc like certain other ETF’s. If you have time and you can hold them for five years and so they most likely will come back and absolutely be winners again. But the key is do you have the cash to buy them now or were you totally invested, and you did not hold back any reserve whatsoever? Again, that's why Alliant Credit Union is so important because you need to have a place that you keep cash so when things like this happen and things like this are normal everybody. The market just doesn't go up and up without a pullback and what's so great is like I love this stock Up Start and Up Start with like 400 some odd dollars a share. And now it's like I think at 116, oh my God in the long run Up Start’s going to be a fabulous company. Would I buy it now? Possibly not but it's just there these companies are fabulous, but you have to have time on your side. But again, I would say be careful now that I don't want you to pull the trigger quite yet because I'm not sure we're at the bottom here. But that doesn't mean you can't nibble. So, what am I trying to say to all of you? I'm trying to say to you, be patient here. Now, last year I was saying to all of you might want offset some of your gains with some of your losses and so that you could start this year out with having some cash. Didn't I tell you that's what I myself was doing and that's what I did. But a lot of you, all you do is you watch it go up, up, up, up, up, but are you looking at the diversification of your portfolio's? Remember me telling you the story about this one guy who wrote in and all his portfolio was made up of technology stocks and of course he was going to be obliterated. You have got to be diversified which is why you should go back and listen to some of the past podcasts and learn from them. Let's talk about Bitcoin and Cryptocurrency for a while here. Bitcoin also, is down considerably like $25,000 from its high. Did I not also tell you that it's okay. Bitcoin is going to go up, it's going to go down but all of you got so used to watching it go up, up, up, up, that then you freak out when it goes down. Bitcoin, Ethereum, fabulous. If you have time and you're just willing to wait, like didn't I tell you if you buy these Crypto’s you have to hold on for dear life, you just do. So, if that's not your temperament then well you might want to think about it, okay? Also, if you're out there and you are thinking about refinancing your home for whatever reason, make sure you do it now because interest rates are going to start to go up. So, when that happens, that's not the time you want to wait to do so. Again, are we projecting a good real estate market? They are now, I'm not good at this. You know, I personally will tell you, I didn't see this incredible appreciation of real estate happening. I really thought the pandemic and people not being able to pay their mortgages would absolutely obliterate the real estate market, but yet we'll have to see what happens here when a lot of the moratoriums when people who couldn't afford to pay their mortgages, what's going to happen? But what's happening is people with a lot of money are coming in, they're buying these rental units and charging exorbitant rents and so they're holding up everything just don't go crazy, don’t buy more than you can afford. Do you hear me? So essentially, I think we're going to still be okay, but only if you have time on your side because again, as I was starting to say last year, I said to you, listen, if you need your money, if you need money within one year, two years, three years, this is not money that belongs in the stock market because things like this happen now, it is totally possible if the feds start to raise interest rates faster than they say they're going to simply control inflation, these markets can go down another 20 or 30%. There's nothing saying that they won't. But that's when, if you have money on the side, you can take advantage of it. And if these markets skyrocket and go straight up, who cares? It is always essential that you have cash on the side, especially if you are in retirement. Now listen to me again carefully, I have told all of you that I want you to make sure that if you're in retirement and you have to withdraw money from your IRAs your 401 Ks, whatever it may be to live on, you need at least a 3 to 5 year cash reserve so that when markets go down, you are not withdrawing money from your retirement accounts that are invested to live on. You take the money from your cash reserves to live on because you don't want to sell when the market or the stocks that you own are down. Again, the best place to keep that money is Alliant Credit Union. Now I know I am pushing Alliant Credit Union, big time in this podcast and the reason that I'm doing that is if you look at all the places out there for you to save money, I am telling you Alliant Credit Union is the best place. I don't care if you're putting in $100 a month or if you're putting in $10,000 or you have $200,000, you want to just keep somewhere that is the place to do so. Part of my money is there? So, I don't know. You just might want to think about that. Alright. I think my voice pretty much got us through this now. Here's what I want to tell you on Sundays coming up. Whether it's next Sunday or the Sunday after that, I really want to tell you on Suze’s schools. All the changes that have happened to the contribution limits for 401Ks, the adjusted gross income limits for your Roth IRAs all of those things on another Suze school, I really want to give you a bond buying lesson because a lot of you don't understand really how bonds work and your advisors are charging you investment advisory fees to hold individual bonds for you, which is the biggest travesty out there. I think I did it. I got through a podcast. Oh my God! Um I've missed this so much. You have no idea. One of the hardest things for me to do is to not talk because my whole life, everybody, is the things that I want to say and the things that I need to say and for almost a month now, I haven't been allowed to use my voice even to talk to KT. But being silent, being silent is such an incredible practice. You might want to try it because in silence you hear things, you learn how to listen in a way that's so different than when you're always the one who's talking or you're always the one who wants to say something. You hear things in such a pure way. So, in many ways this has been an incredible blessing for me. Have I been afraid? Oh yeah, did I know if my voice was going to come back? I didn't will it ever come back more than this? We will have to see. But I think it will. But I've done it and I'm here now and I just wanted you to know that I missed you all so much. It's not even funny. So, I hope this podcast brought some clarity to you. Um, KT has picked out many questions for this coming Thursday for ask KT and Suze anything. And again, from my heart to yours. There's only one thing that I want for all of you and that's for all of you to be safe, strong and secure, See you on Thursday, bye bye.

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