We’ve Moved! 6121 Excelsior Blvd. St. Louis Park, MN 55416

Secured Retirement Insights 8/21/21-8/27/21

The Thunder Rolls

Even though it has been an unusually dry summer across the country, we still have experienced a few thunderstorms or can at least remember thunderstorms of past summers.  Some can be calm with the thunder being a low rumble in the distance and others can be violent with loud thunder and sizzling lightning.  The magnitude of impact certain events have on the market is comparable to the intensity of a thunderstorm, which was evidenced last week with a whirlwind of economic and geopolitical events.    

Headline-driven sell-offs midweek led the major stock indices to end the week slightly lower.  We witnessed a dire situation unfold in Afghanistan, but of larger impact to the markets was the Federal Reserve’s (“the Fed”) indication they plan to “taper,” or reduce, bond purchases later this year and eventually end them all together.  The reason this is noteworthy is because the Fed has been purchasing $120 billion worth of bonds monthly since the beginning of the pandemic to help provide stimulus to the economy; this is commonly referred to as quantitative easing or “QE.”  Buying bonds reduces the supply in the open market, causing prices to rise and keeping interest rates low.  This also provides a greater supply of money into the system, which coupled with low-interest rates stimulates the economy.  When the bond-buying is reduced, and eventually ends, this stimulus will no longer occur.  The stock markets reacted negatively to this announcement this week, but this can be viewed as a positive signal since it indicates the Fed feels the economy is strong enough to continue growing on its own and no longer needs the stimulus. 

The economy is transitioning as we move past the pandemic recovery and into a more mature phase with markets shifting from recovery mode to expansion mode.  The transition between stages in the economic cycle has implications for various asset classes and sectors, which is why we remain vigilant and active in managing client portfolios to ensure they are optimally invested for where we are in the cycle. 

The Consumer

Key economic releases last week were focused on retail sales, which came in below expectations. This was blamed on the rise of coronavirus cases from the Delta variant, however, it should be noted this data was from the prior month, much of which took place before the recent surge in cases was making headlines.  It was interesting that many retailers which reported quarterly earnings this past week exceeded estimates and provided higher guidance for future earnings.  The message from individual companies as consumer spending remains strong and is expected to continue through the rest of the year. The discrepancy between the monthly economic releases as well as the variances in individual company earnings reveals why individual security selection in a portfolio can be crucial.  Consumer spending is a strong driver of the economy so we will continue to monitor this data for signals about the direction we are headed. 

Looking Ahead

The major economic release this upcoming week will be quarterly GDP, which is expected to reflect another strong quarter of growth.  There will also be data released for existing home sales and durable orders, however, what has the potential to move the markets would be further geopolitical events and the attention given to the surge in Covid cases.  The market seems to be pricing in the downbeat headlines regarding the Delta variant so if the news becomes more optimistic we could see a quick upswing in the market. 

At Secured Retirement, we keep a keen eye on what is happening in the world and what impact that has on the markets.  We use this information to position our portfolios so they can weather all storms that may arise. 

Have a wonderful week!

Nathan Zeller, CFA, CFP®

Chief Investment Strategist

Secured Retirement


Please contact us if you would like to review your individual financial plan or learn how the TaxSmart™ Retirement Program can help you.   

Office phone # (952) 460-3260

Share This Article

Get the latest retirement news today!

Subscribe Now

  • This field is for validation purposes and should be left unchanged.

Pick your topic or keywords

Similar Posts

Getting to the Truth: How Strong is Social Security Anyway?

The number one news headline grab this month isn't the Kardashians or Donald Trump. Nor is it Spieth's distressing loss at the Open Championship by…

Continue Reading
Secured Retirement Radio: Probability Investing vs. Safety First

Blog post written by Dale Decker We all have different tolerances for risk. Some people prefer to go big and climb Mount Everest. Others are perfectly…

Continue Reading
Cary Grant’s Retirement Income Checklist

“You never miss the water until the well runs dry.” His Girl Friday (1940) – Walter Burns (Cary Grant) In the 1940’s movie His Girl…

Continue Reading

Danielle Christensen


Danielle is dedicated to serving clients to achieve their retirement goals. As a Paraplanner, Danielle helps the advisors with the administrative side of preparing and documenting meetings. She is a graduate of the College of St. Benedict, with a degree in Business Administration and began working with Secured Retirement in May of 2023.

Danielle is a lifelong Minnesotan and currently resides in Farmington with her boyfriend and their senior rescue pittie/American Bulldog mix, Tukka.  In her free time, Danielle enjoys attending concerts and traveling. She is also an avid fan of the Minnesota Wild and loves to be at as many games as possible during the season!