“A goal should scare you a little and excite you A LOT” – Joe Vitale

As we surpass the midpoint of 2024, it’s time to reflect on the financial journey so far and strategically plan for the remainder of the year. Mike Brady of Generosity Wealth Management provides a comprehensive review of the stock and bond markets, shares key insights on current economic conditions, and offers forward-looking strategies to help you make informed financial decisions. Discover how to balance strategic and tactical thinking to optimize your financial future.



Hi there! Mike Brady with Generosity Wealth Management, a comprehensive, full-service financial services firm headquartered here in Boulder, Colorado.

It is the midpoint of the year. Half of the year has gone by, with half still to go, and so I want to first discuss what’s happened so far and where we are presently, and then I want to discuss strategic and tactical levels of thinking going forward.

First, what’s happened so far? The unmanaged stock market indexes are at all-time highs and looking great. The first quarter this year was outstanding. April wasn’t so much fun and frankly, we gave some of that up. Then May and June were good, recovered and back to highs again, which is outstanding.

When you look at the growth, specifically the large-cap area, that’s been the winner so far this year. The loss on the equity side of the big categories is the smaller cap on the value. If it’s a small-cap, smaller companies, in general, they’re single digits. If it’s larger company stocks, then it’s double digits for the year, which is outstanding.

As we look at the unmanaged bond indexes, those indexes that are short-duration, meaning a couple of years, are actually slightly positive for the year. If it’s anything longer than that, they’re probably a little negative for the year. The unmanaged stock market indexes are positive for the year from single to double digits. The bonds indexes that are short are maybe slightly positive but the vast majority of the duration of the longer term are slightly negative.

Most portfolios have a stock and bond component to them, which still makes sense. One of the reasons why the mid to longer-term duration bond indexes are negative is coming into 2024, most people had priced in, most traders had priced in, a decrease in the rates from the Fed, the discount rate from the Fed, over the next year much more than what’s actually happened so far, and what they’ve led us to believe will happen for the rest of 2024. It doesn’t mean that it’s not going to happen. It doesn’t mean that the middle and the longer durations are not good places to still be and to have a portion of a portfolio in general of course. But it just hasn’t happened yet. So, it’s better to be too early than too late is what we always say.

So far, 2024 is looking great. For the rest of the year, we have a lot of stuff going on. The biggest impact is probably the election in November, which is the biggest uncertainty. They’re neck and neck at this particular point. This has long term consequences for the next four years and the economy and regulations and things of that nature. There’s a whole other podcast about the interaction between our fiscal policy, which is our government policy, the regulations from our executive branch, and, of course, the interaction, the overlapping areas with the private sector, and how that moves things going forward.

Of course, from a monetary policy point of view, the Fed has not been as aggressive in decreasing rates as it was in increasing them, so hopefully, that will happen soon for the second half of the year and going into 2025. There is still a lot going on this year for 2024.

I’m going to put up on the screen the S&P 500, which is an unmanaged stock market index, and various inflections going all the way back to 1996. Now, the reason why I share this is because many times, people say well, we’re obviously at a high. The answer is, well, there’s nothing obvious about the future, and frankly, most of the time, it was under 1,000 – the S&P 500 was under 1,000, so 600 or 700 back in 1996. I’ve got to be honest with you, people then were saying, well, it’s obviously at a high. Now it’s closer to 5,500, and I’m pretty happy that people didn’t say it’s obviously at a high. Let’s move everything to the money market or out of some kind of an index or in equities.

S&P 500's resilience and long-term growth despite periods of significant volatility and economic downturns.

The question you have to ask yourself is it’s a high compared to what? I mean, it might obviously be a high to what we already know, which was five and ten years ago, but it’s certainly not obvious that it’s a high to where it might be in five or ten years from now. As a matter of fact, we hope that it’s a low. It’s a high from where it was. It might be a low from where it will be. If you don’t believe that the future is brighter than today, then why do you have investments? I mean, in 5 or 10 or 20 years from now, whatever your time horizon might be, if you don’t believe it’s going to be higher, then you’ve got to put it under the mattress or in CDs or money market. That’s the answer if you don’t believe that. Is it a high to where it would be in a week, a month, a year? Sure, possible. But that sure better not be your time horizon when you’ve got some kind of an equity position. I want to highlight that. I have to tell you that the S&P 500, since 1980, which is 44 years, has had 33 positive years. So, three out of four are positive, and one out of four are negative. The future could be different. It’s just that simple.

I want to quickly change to strategic and tactful thinking because this is really important, I believe. It’s what we do, where we might add the most value to our lives, and I, as your financial advisor or potential financial advisor, might add the most value. Strategic thinking is the big picture. Tactical thinking – let me step back and let me give you an example.

Strategic thinking if you’re working at a company is, hey, if I work really hard, maybe someday I’ll be department head. Then, if I do that, then I’m going to become the chair of something bigger than that. Then someday, if I work really hard, I can be CEO, and I’ll be successful in my career. Well, I had better get down to today’s job, which is filling out these forms or all my reports or whatever my daily job is that I have to get done this particular week.

But thinking about what’s possible, all those steppingstones, the path to your ultimate goal, that’s strategic thinking. Then you’ve got to bring it back down to tactical thinking. Okay, great, I have step number one, step number two, and step number three. The strategy might be from department head to vice president to CEO. Whereas we also have to get down to okay; what’s the nitty gritty on my to-do list? A company is no different. If you’ve got a manufacturing company, you’re sitting there thinking, what are my customers going to need three and five years from now? What are my employees going to need three and five years from now? What’s the environment? Where do I want to go? Do I want to sell the business at some point? Do I want to have my employees take it over? There’s lots of different strategic decisions, but then I also have to make sure that we get these sales orders out today and this week so that we make our numbers. We’ve got tactical and then we have strategic.

The reason why I bring this up is your life is the same way. I mean, it’s this cliché that life is a journey, but it’s more than a cliché. It really is a journey. When you’re young, you’re thinking to yourself well, if I go to college, then I’ll graduate and hopefully get a better job or get the skills in order to make my financial life good and rewarding. But I’m probably going to get married and maybe have a family and buy a house, a boat, an ATV, and all that stuff. Along the way, I will try to accumulate some assets for retirement. Then, at a certain point, I’m getting closer to retirement, and I want to protect that and make sure I don’t lose what I’ve worked 20-25 years for. Then you go into a protect mode and maybe a distribution mode. Great, I’m now retired. How am I going to get the money out? There’s a lot of decisions. That is strategic thinking.

And then there are a lot of decisions along the way. Do I do the 401k? A Roth 401k or not? How can I reduce my taxes along the way? If I’ve got a brand new child 18 years from now, I want to help with education. Or maybe my child is 17 and is going next year. How do I pay for that and the distribution from that? As we get older, we think about long-term care, we think about Social Security, and we think about required minimum distributions. We think about lots of things along the way, and my job is to help you with those strategic questions about where I am going and then implement and help you – maybe I take some of those tactical decisions on myself on your behalf, and then I’m going to report to you, or we work on them together. Hey, did you do this? I can’t do that, but you can, or have you worked on that? It kind of knocks those things off.

This is one of the things that I’m really working on going forward over the next six to nine months. I have lots of really fun and exciting things to share with you because, strategically, Generosity Wealth Management, I’m going to try to do a better job of describing all of the services that we do. We’ve done a good job of saying who we are, but what and how is what I’m going to start to articulate a little bit better over the next six to nine months, and all of our services. And I’m adding services, taking nothing away. I’m enhancing and upping our game so we can have Generosity Wealth Management 2.0, which is what we talk about here behind the scenes. So, Generosity Wealth Management 2.0. New services, a more comprehensive list of all the things that you may or may not be taking advantage of. I want you to get the most out of our relationship, and I want to be better about explaining that to you, to your friends, your family, and potential people as well going forward. That is forthcoming.

That being said, I’m going to end today’s newsletter. Mike Brady, Generosity Wealth Management, 303-747-6455. Give me a call or send me an email. I’d love to hear from you. You have a wonderful summer. Thanks. Bye-bye.