Dominic Ceci: Three preelection topics for Wisconsin investors
Share
- Dominic Ceci: Three preelection topics for Wisconsin investors
- Johnson Financial Group Breaks ground
- 4 Reasons Why Retirees Should Still Be Checking Their Credit Report
- C-Suite Stars: Here are the Milwaukee Business Journal's top finance executives for 2024
- Johnson Financial Economist on the Election and the Economy
- Johnson's Ceci sees normalized earnings leading to a sideways market
- Most Corporate Charitable Contributors in Wisconsin, JFG Ranks #16
- Deloitte ranks Wisconsin's 75 largest privately-held companies by revenue
- Retirees, It’s Time to Give Yourself a Raise. How to Keep the Cash Flowing for Decades.
- Notable Women in Wealth Management: Kelly Mould
- Coolest Thing Made in Wisconsin contest now open
- Shaping the future of wealth management with empathy and vision
- Life's financial milestones; expert shares formula to navigate challenges
- What Is the Average Retirement Savings for Gen X?
- Johnson Financial Group's CIO, Tim Brown, Nominated for Prestigious ORBIE Award
- Why one 69-year-old woman initiated a 'gray divorce'
- Johnson Wealth appoints former U.S. Bank exec as its president
- The Power of Money with Kyle George
- Johnson Financial Group Expands Wealth Management Team with David Dauchy and Brad Mazola
- Divorce rates among baby boomers are soaring, putting women’s financial security at risk
- The Latest Tech Trends in Financial Services with Tim Brown, CIO at Johnson Financial Group
- Johnson's Ceci: Hard landing potential rises until rates start falling
- Peter Speca Joins Johnson Financial Group
- When Retirees Give Away Too Much Money
- $10bn Shop's Top Gatekeeper Gets ‘Interesting’ With Fixed Income
- After ‘rock fight’ in 2023, banks see businesses taking wait-and-see approach
- What does your spouse want in retirement? 6 questions to ask.
- When Retirees Give Away Too Much Money
- Johnson Financial Group: Expands presence in Madison new West Towne location
- Johnson Financial Group Shares Tips for Buying a Home in 2024
- Advisors Urge Caution On Penalty-Free IRA, 401(k) Early Withdrawals
- Donations of nearly $70K pour in following tool theft from Waukesha Habitat for Humanity
- Dominic Ceci appointed Chief Investment Officer for Johnson Financial Group
- Associated Bank, Johnson Financial partner to provide funding for affordable-housing project in Madison
- Understanding Interest Rates and Unlocking Financial Power
- Ben Pavlik, Top Corporate Counsel Award
- Your Guide to Women’s Wealth Management
- Tim Sheehy appointed to Board of Directors
- WMC, Johnson Financial Group: Announce 2023 Coolest Thing Made in Wisconsin
- Johnson Financial Group ready to serve Lake Country community
- Most Corporate Charitable Contributors in Wisconsin
- Preparing Clients For The Risk Of Cognitive Decline
- Johnson Financial Group expanding with acquisition in Appleton
- How Big A Gamble Is Monte Carlo For Advisors?
- Married … With Finances
- Johnson Financial Group CEO discusses branch strategy with one set to open and another in the works
- Squire to retire after nearly two decades as Johnson Bank regional president
- Bringing a Personal Touch to Digital Banking
- At This Rate: Financial Institutions Dealing with Higher Interest Rates and Lower Loan Demand
- Table of Experts: Reading the tea leaves
- Checking in on Wisconsin banks
- Beyond Lip Service In DEI
- Johnson Financial Group to sell its insurance business to Boston firm
- Johnson Financial Group plans new branches, including in West Milwaukee
- New Johnson Financial Group Branch Planned In West Milwaukee and Delafield
- Johnson Wealth Fixed Income Tilts at Emerging Markets Debt, Mortgage Backed Securities
- Your Financial Foundation with Al Araque on the Lifeblood Podcast
- Unexpected health insurance surprise possible when pandemic insurance programs expire
- Bond Investors: Be a Prudent Pig, not a Yield Hog
- Women Insurance Pros on Balance, Community and the Future
- Financial Planning For Couples Who Totally Disagree
- How To Help Clients Who Own Businesses in Declining Industries
- Johnson Financial Group presents 'Lightfield' coming to Cathedral Square Park
- Johnson Financial Group Named Top LGBTQ Workplace
- Financial advice is the midlife job that women want – but don’t know exists
- Expert Insight for Beginner Rental Property Investors
- Coolest thing made in Wisconsin announced by WMC and Johnson Financial Group
- Corporate Charitable Contributors in Wisconsin
- 'Coolest Thing Made in Wis.' voting begins
- Johnson Financial Group and Habitat for Humanity Kenosha work together to help homeowners
- We have a responsibility to be solution providers for our customers
- Being a leader is a team sport
- Jason Herried Joins Chuck Jaffe on Money Life
- Have questions about "Gray Divorce"? Attorney Kelly Mould, CRP® can help.
- Jazz in the Park Is Back Thursday Nights Starting July 21
- People in Business - Al Araque
- 2022 Housing Market Overview: Everything You Need to Know
- "Give Back More Than You Take" - Helen Johnson-Leipold
- A Brief History of Economic Crises, Crashes and Recoveries
- Kelly Mould and Kate Trudell Earn State Bar Award for Outstanding Service
- JFG Supports Affordable Housing through FHLBank Chicago
- Helen Johnson-Leipold shares business tips for success at Marquette speaker series
- Notable Commercial Banking Leaders: Thomas Moore
- Notable Commercial Banking Leaders: Viktor Gottlieb
- Johnson Financial Group partners with Racine Habitat for Humanity to service mortgages at no cost
- Upcoming Lineup Of Broadway Shows Announced At Marcus Performing Arts Center
- See the Milwaukee Business Journal's 2022 Real Estate Award winners
- Joe Maier “Employers are going to have to rethink their practices”
- Emotional Investments: Why They Happen and How to Avoid Them
- Investors are a growing force in the residential real estate market, but how should sellers evaluate these offers?
- Inflation advice for younger colleagues
- Amber Krogman: 40 Under 40
- Rising Stars in Wealth Management: Robert Schneider
- Should You Sell Your House to an Investment Company?
- Evoking change within the Milwaukee community with Johnson Financial Group's Jim Popp
- A Shift in the Tech Landscape
- Evoking change within the Milwaukee community with Jim Popp, CEO of Johnson Financial Group
- The Rising Trend Of "Gray Divorce" with Kelly Mould of Johnson Financial Group
- Evoking change within the Milwaukee community with Jim Popp, CEO of Johnson Financial Group
- Johnson Financial Group Recognized on Financial Planning's 2021 RIA Leaders List
- Find out why these business leaders are 2021 Milwaukee-area power brokers
- Thoughts for business executives on future-proofing a business
- Jim Popp Joins Fox 6 to Announce the Milwaukee Holiday Light Festival
- Milwaukee’s Holiday Lights Festival Kicks Off This Week!
- #FreeBritney: When Protections Turn Toxic
- WisBusiness: the Podcast with Jim Popp, president and CEO of Johnson Financial Group
- WE Energies Customer Spotlight On Energy Efficiency
- Johnson Financial Group donates $500,000 to United Way organizations across Wisconsin
- Madison’s Moving Business Forward Podcast
- Thoughts for business executives on return-to-office technology
- First look: Johnson Financial Group's new Downtown offices and branch
- Johnson Financial Group Shows Off High-Rise Office
- Six Tips for Developing a Business Plan for Uncertain Financial Times
- Is Bitcoin Here to Stay? An Assessment of Opportunities and Risk
- You may have a ‘huge edge over high-powered investors,’ says investing risk expert: Here’s why
- Executive Insights with Jim Popp
- CEO Jim Popp Honored as Distinguished Executive
- Webinar: Cybersecurity Made Simple
- 2021 Guide to Wealth Management: A War on Wealth?
- Notable Alumni: Scott Cooney
- Jason Herried Joins Chuck Jaffe on Money Life Market Call
- Top Workplaces 2021: Q&A with three CEOs who were recognized for their leadership during a challenging year
- How will Biden's new tax plan affect you?
- American Jobs Plan: Potential Implications for You and Your Business
- Get on the Right Track to Financial Freedom
- Greater Madison area Top Workplaces 2021
- The Crazy Housing Market: Buy, Sell or stay on the sidelines?
- UPAF Ride for the Arts series will take place over three June weekends
- Financial services industry helped guide businesses through sharp downturn: Banks hustled to meet massive PPP demand
- Financial services industry helped guide businesses through sharp downturn: Banks hustled to meet massive PPP demand
- Johnson Financial Group matches food donations to help feed Wisconsin families
- Johnson Financial Group: To donate $300,000 to help feed Wisconsin families
- Women in Leadership: Sharing & Celebrating Women's Stories
- 2020 Milwaukee-area power brokers
- Dow Surges to Highest Level Since February on Vaccine Results, Biden Win
- Johnson Financial Group Named One of Wisconsin's Largest Corporate Charitable Contributors
- Don't forget about the "I" in D&I
- Johnson Financial Group to move Milwaukee offices to Cathedral Place
- Pandemic Uncertainty Leaves Wisconsin Bankers Ready To Reserve
- What's going on in the financial markets right now with Jim Popp of Johnson Financial Group
- Downside risk is now a pit, not a chasm. Still, underweight stocks & overweight (some) bonds.
- Why You Want To Keep Your Politics Separate From Your Investing
- Johnson Financial Group growing, still hiring on its 50th anniversary year
- The COVID Calculation
- Pleasant Prairie company gets boost from Paycheck Protection Program
- Banks locally, statewide step up to help businesses obtain $8.3 billion in PPP
- Johnson Financial Group donates $200K to support United Way, other nonprofits during COVID-19 pandemic
- Second round of PPP starts slowly as Milwaukee-area businesses still await loans
- Wisconsin lenders ready to shell out hundreds of millions in Paycheck Protection Program loans
- Planning opportunities under the CARES Act
- BizTimes Media Announces Milwaukee’s Notable Women in Commercial Banking
- Johnson Financial Group adviser honored
- Tech-driven R&D goes beyond the budget. Some Milwaukee execs speak up
- What would cause markets to react after Fed meeting
- Banking official remains confident in local economy's growth
- Rock County home prices continue to climb
- The coolest thing made in Wisconsin
- Dan Defnet named president of Johnson Bank
- Future Returns: Ignore Politics When Investing
- Local banker to get Forward Janesville's Lifetime Achievement Award
- Wisconsin Could See Economic Slowdown This Year, Not Recession
- When Corporate Bonds Are a Risky Investment
- Johnson Financial Group becomes Broadway at the Marcus Center title sponsor
- Getting Ready to Exit: What Baby Boomers know and should know about getting their business ready for sale
- Take Five: Putting some Popp in banking
- Jim Popp in the News
- Jason Herried's Take on the 'Booms and Busts' of the Economy
- Johnson Insurance creates new 'workplace of choice'
- Paul Ryan lauds Harvard award-winner Helen Johnson-Leipold
- Business Leader of the Year Helen Johnson-Leipold leads big parts of the Johnson family business
- Johnson Financial Investment Expert: More growth, low inflation ahead
- Foxconn's Balance Sheet Tipped in Mt. Pleasant's Favor
- JFG honored by Department of Defense
- The Open Road comes to the Milwaukee Art Museum
- 3 business lessons from the new Johnson Financial Group CEO
- Executive Q&A: Jim Popp takes the helm at Johnson Financial Group
- Banking exec Jim Popp named president of Johnson Bank
- Banker: Focus on millennials, not president
- American Birkebeiner Legacy Lives on with Support from Johnson Bank and Johnson Family Foundation
- TEMPO MILWAUKEE 2020
The column below reflects the views of the author, and these opinions are neither endorsed nor supported by WisOpinion.com.
The looming election weighs on many investors’ minds. Here are three big reasons why history suggests you can set the election to the side when conducting financial planning.
- Pulling money out of markets to avoid elections works against you. Historically, going back to 1960, if you were to have invested $100,000 in the S&P 500 Index but taken the money out for six months every four years—during the second half of election years because you’re worried about the impact of elections—you would have lost half the return versus simply staying invested.
- Similarly, investing only when one party or the other is in power works against you. Since 1896, you would have missed on a return approximately 10 times higher if you’d simply stayed invested!
- Economic growth, stock market performance, and election outcomes are uncorrelated, historically. Sometimes people say Republicans will be better for, say, the oil industry, but even that doesn’t play out how you might think.
Historically, presidential elections aren’t particularly important for investors. We don’t set investment policy based on politics and advise that no one else should either.
Looking past the election, many investors are focused on two big themes: artificial intelligence (AI) and the health of the economy. Both relate to Wisconsin.
Artificial Intelligence (AI)
AI has been this decade’s “smartphone moment.” It’s an interesting growth story. We don’t know exactly where it’s going. Estimates for the impact on GDP are all over the map, from almost none to trillions within the next 10 years. What we do know is that companies are spending a lot of money right now to build out AI infrastructure.
Much of that infrastructure involves data centers. Interestingly, these tend to be built in concentrated clusters because of the power and water demands. Loudoun County, Virginia, is a good example—and Southeastern Wisconsin has the potential to be so in the future.
Actual adoption of AI right now is pretty low, around 15-20% even in tech-forward industries, and more like 7% in others. So there’s a lot of room for increased usage of these technologies. It’s a pretty common narrative that when ChatGPT went live, it had the fastest user growth of any app ever. But what you don’t often hear is that user engagement is among the lowest. People go on out of curiosity, play around with it, but then don’t really engage with the product much after that. For professional applications, the costs are still high.
So, for now, the winners are the companies building the core infrastructure. There’s government money behind that, and plenty of private investment too. That cash flow is real. Beyond semiconductors, energy and infrastructure are the big winners here.
Health of the Economy
Wisconsin is a useful microcosm illustrating the Federal Reserve’s challenges.
Wisconsin’s 2.9% unemployment rate is low for problematic reasons. The workforce participation peaked in 2017, with older workers retiring and not being adequately replaced by younger workers. Additionally, prime working-age people with families are opting out of the workforce due to high childcare costs. This has led to a tight labor market where businesses are struggling to find workers to fill open positions.
So, even though unemployment figures are attractive, things may be somewhat worse than they appear based on economic data. Consumer surveys show people think it’s harder to find a job now than earlier in the year. If people perceive the labor market as more challenging, that may lead them to slow down spending. That said, economists are largely lining up behind the proverbial “soft landing” coming to fruition, meaning no recession in sight.
Still, cost of living is a difficult topic. Lower inflation misses a big part of the story. Prices went up a lot and are now just going up more slowly. The fact that the price of eggs went from $5 to $6 and is now rising at a slower pace to maybe $6.20 next year doesn’t change the fact that eggs are a lot more expensive than they used to be. Those higher price levels are more impactful for lower-income consumers. Those extra dollars really add up for them and can lead to cutting back discretionary spending.
A big theme is that the economy is bifurcating, not just for households but for businesses too. Smaller companies are having a harder time than large corporations, and a big part of that is their higher cost of borrowing. Large companies with good credit are borrowing at rates not that far above Treasury yields. But smaller, riskier companies are paying double or triple that, often on floating rate terms that increase their vulnerability. There’s a big difference in how different tiers of businesses are weathering this environment.
Long-Term Lens
In our investment process, we look at things with a very long-term lens. We believe that’s how you win as an investor. If you try to trade short-term moves, you’re likely to lose money and even if you get it right, you’ll face high tax rates. So we forecast returns over 10-15 year horizons.
Through that lens, we expect the return outlook to flatten out, with bond yields staying in the current range. Equities are expensive, so returns will likely be on the lower end of the historical range over the next 10-15 years. If you’re investing new money today, you probably won’t get a 10% annual return like the long-term historical average.
The good news is that bonds are in a much better position now than they were a decade ago when rates were so low. And alternative investments can be additive in this environment as well. Several opportunities in the alternative-investment space are attractive right now.
Our best advice is to stay diversified across stocks, bonds, alternatives … and ignore the impulse to make investment decisions relating to politics.