July is undoubtedly a time to celebrate our nations independence, but also a time to reflect on the importance of being surrounded by family and friends who make you the best version of yourself. So as you fire up your barbeque, chill down your favorite beverage and plan to enjoy the great outdoors, we invite you to read the July edition of the Hilltop e-newsletter Your Wealth Connection. We trust you will find the information useful and hope you can learn a bit more about what is new here at Hilltop.
We encourage you to visit our website, HilltopWealthTax.com, to learn more about our services, our team and upcoming events for clients and friends.
The Hilltop Ice Cream Social – July 20, 2022
• Mark your calendar for this family friendly annual event!
• Learn more about our new charitable fund and how you can get involved.
• Major Risks to Family Wealth
• Rehearsing for Retirement
• Information about the Capital Markets and what is going on with our current economic conditions.
• Introducing Hilltop’s Newest Team Member – Ira the Hedgehog!
• The greatest compliment we can receive is your referral.
As always, we are honored and humbled that you have given us the opportunity to serve as your financial advisor.
From the entire Hilltop team, we hope you enjoy the information!
Erik W. Brenner CFP® NSSA®
CEO, President and Private Wealth Advisor
Allow us the opportunity to build you a custom Retirement Roadmap and we’ll send you a $100 Gas Card.
ICE CREAM SOCIAL
Wednesday – July 20th
4pm – 7pm
We invite you to an Ice Cream Social in the Hilltop Wealth parking lot. We’ll have ice cream from The Chief Creamery of Granger, the American Espresso coffee cart, cotton candy cart, face painting, balloon artist, games, and a dunk tank fundraiser!
Kids and grandkids are highly encouraged to attend.
Dunk the Hilltop team! All proceeds benefit Hilltop Kids, providing direct assistance to schools and families in need in our communities.
1 ball for $5 3 balls for $10 Push the button for $50
WHO IS IN THE HOT SEAT?
4:00-Tareq Jallaf, Investment Operations Associate
4:30- Shaun Fedder, Director of Operations
5:00- Cliff Hawkins, Private Wealth Advisor
5:30- Matt Aurenz, Private Wealth Advisor
6:00- Bill Davis, Private Wealth Advisor
6:30- Erik Brenner, CEO and President
Questions? Contact Marla by email or call 574-889-7526
What began as a conversation about how the Hilltop team can best give back to the communities where we live and work quickly gained traction and we are very excited to announce the launching of Hilltop KIDS! This charitable entity is incorporated in the State of Indiana and has received full exempt status from the IRS as a registered 501(c)(3). We formally launched the fund at the South Bend Cubs Rooftop event and were thrilled by the positive reception from all the guests.
The primary focus will be to assist at-risk children and their families and we envision the fund will be a used to provide both direct support to those in need and partner agencies that share similar visions, missions and passions.
Hilltop KIDS will also be an avenue where Hilltop team members can provide financial literacy to those who are often targets of predatory lending, get buried by high interest rate credit card debt or need assistance with constructing and adhering to a sound budget.
There will be many exciting opportunities on the horizon for Hilltop KIDS, including the establishment of a scholarship. Please reach out to our offices if you are interested in learning more!
The Wall Street Journal summed up the first six months of the year with a simple but telling headline: S&P 500 Posts Worst First Half of Year Since 1970.
Morningstar said the Dow’s performance was the worst since 1962.
Source: Wall Street Journal, MSCI.com, MarketWatch, Bloomberg
MTD returns: May 31, 2022—June 30, 2022
YTD returns: Dec 31, 2021—June 30, 2022
*In US dollars
In part, it’s a timing issue since both indexes hit their respective peaks in the first week of 2022.
Timing issues aside, stocks have tumbled since hitting all-time highs, and the S&P 500 Index has shed 23.6% from its January 3 peak to its June 16 trough, which officially lands us in a bear market.
The stock market is considered to be in a bear market when the broad-based index falls 20% from a prior peak.
Since 1957, there have been 13 periods when the S&P 500 has lost 20% or more over six months. That averages out to about one such decline every five years. In other words, it’s not that unusual.
Six of the seven worst sell-offs centered around the 2008 financial crisis, ranging from losses of 29.4% to 42.7%. The outlier occurred in 1974, when the S&P 500 shed 32% over a six-month period.
That 70s show
In 1972, the Consumer Price Index soared from an annual rate of 2.7% in the middle of 1972 to over 12% by the end of 1974, per St. Louis Federal Reserve CPI data.
While the roots of inflation in the 1970s do not mirror what we see today, we do find some similarities, including ultra-easy money in the early 1970s, a lack of fiscal discipline, and soaring oil prices tied to the 1973-74 OPEC oil embargo.
The U.S. is not as dependent on foreign sources today and much greater fuel efficiency mitigates some of the impact, but rising gasoline prices are playing a role in the rise in the CPI, which hit 8.6% in May.
An oil embargo, soaring energy prices, and a sharp rise in interest rates contributed heavily to a recession that began in late 1973 and lasted until early 1975, according to the National Bureau of Economic Research (NBER).
Some commentators believe we are already in a recession. And while there are parallels between then and now, no two periods are exactly alike.
Today, Fed Chief Jerome Powell continues to talk about the importance of getting inflation under control. And the Fed seems to be in no mood to veer from its inflation-fighting course, even if it means a recession.
But a recession is not a foregone conclusion.
Although economic growth has slowed, consumer confidence is down, and a decline in Q2 GDP is on the table, job growth has been robust, layoffs are low (though they have ticked higher), and consumers are splurging on travel and other services that were out of reach in the pandemic.
We know market pullbacks and bear markets are inevitable, and we recognize they can create unwanted angst. We also know that an unexpected, favorable shift in the economic fundamentals could fuel a sharp rally since sentiment today is quite negative.
As we have seen from over 200 years of stock market history, bear markets inevitably run their course and a new bull market begins.
We saw that after the 2008 financial crisis, and we saw that after the Covid lockdowns led to a swift bear market and a steep but short recession.
We also saw stocks rally from the lows of the 1974 bear market.
We know times like these can be difficult. If you have questions or would like to talk, we are only an email or phone call away.
NEW TEAM MEMBER
She’s tiny enough to fit into the palms of your hands but is a big star at Hilltop Wealth & Tax Solutions. Introducing Ira, the African Pygmy Hedgehog!
Ira loves running at top speeds on her wheel, chomping on bugs, exploring around the office, and sleeping.
The average adult hedgehog has about 3,000–5,000 quills and are controlled by muscles running the length of their back. When a hedgehog feels threatened, they curl into a tight ball and tuck in their heads, tail, and legs, to protect vulnerable parts of their body. However, Ira doesn’t have too many threats to worry about around the office! They are very curious and active, especially at night and can run at a top speed of 9.5 mph and travel a distance of five miles during the night!
Be sure to like our Facebook page to keep up on Ira’s adventures and stop by our Mishawaka office to welcome Ira to the Hilltop team!
HILLTOP TAX SOLUTIONS
Did you know?
Did you know that our seasoned tax professionals can help beyond just preparing and filing your Federal and State Income Tax Returns? If you are in need of bookkeeping or accounting services, Hilltop Tax Solutions offers a flat monthly or quarterly fee to help streamline your business.
JULY TRIVIA: As always, please submit your responses to Marla Brenner and those who answer all three questions correctly will be entered into a drawing to win this month’s prize. Good Luck!
- Where do the proceeds go from our dunk tank fundraiser?
- How fast can hedgehogs run?
- What is the Hilltop Hedgehogs name?
This letter is not intended to be relied upon as forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. The opinions expressed are as of the date noted and may change as subsequent conditions vary. The information and opinions contained in this letter are derived from proprietary and nonproprietary sources deemed by Hilltop Wealth Solutions to be reliable. The letter may contain “forward-looking” information that is not purely historical in nature. Such information may include, among other things, projection and forecasts. There is no guarantee that any forecast made will materialize. Reliance upon information in this letter is at the sole discretion of the reader.
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