Have you ever wanted to read through some of these guests? I am Rob West. The third stanza of That Carol Boldly Proclaims, Change shall he break, for the slave is our brother, and in his name all oppression shall cease. Today I'll talk with Rachel McDonough about how investing relates to this verse and how you can be a part of it. Then it's on to your calls at 800-525-7000. This is MoneyWise Live, biblical wisdom for your financial decisions. Well, our guest today is Rachel McDonough. Rachel is a certified financial planner and a certified kingdom advisor, and she always has her sights set on how we can engage the culture with our investment decisions. Rachel, great to have you back with us. Thanks, Rob. Thanks for having me.
Absolutely. And Rachel, as you know, faith-based investing continues to grow as a movement, and we're constantly hearing from folks who want to get involved. So what do you have for us today? Well, I'd like to talk for a few minutes today about the connection between slavery and our investing. Now, when people hear Oh Holy Night, of course, they don't typically think about slavery for very long, just that one line, and they definitely don't think about investing. But actually, let's just imagine the connection right now. If you can just kind of put your thinking caps on for a moment and think through this lyric, all oppression shall cease.
In his name, all oppression shall cease. And I believe that that has a lot to do with the flow of capital and how we can make intentional investment decisions as ambassadors of Jesus, and that in his name, we can exhibit justice and mercy to the way that we invest so that investing becomes more than just about risk and return, but it becomes redemptive and even relational. Well, that's certainly a compelling vision. Give us an example of this type of investing. Yeah, I was privy to witness the launch of a brand new investment vehicle this year, something that I had never even imagined possible before. It's a venture capital fund. So they're investing in startup companies that are for profit businesses that are specifically focused on eliminating human trafficking and elimination of slave labor. So this, again, is not a nonprofit. You may have thought you misheard me, but in fact, it's not a nonprofit. It's a for profit investment vehicle.
And this is a wonderful example of the innovation and creativity that we're seeing in the faith based investing arena. Yeah, and this is a real problem. I know folks often think that slavery ended in 1865 with the 13th Amendment. But this is a big issue today, isn't it?
It certainly is, Rob. According to international justice missions, there are right now about 50 million people enslaved across the world today. And so even though we think of slavery as really an issue of the past, it's estimated that the supply chain currently enslaved more people today than at any other time in human history.
And if you're thinking of plantations and, you know, large factories that have a large number of agricultural employees, it really just isn't that old image of slavery. These are sadly people who indirectly are working for me and you because of our shopping and investing patterns. But of course, none of us intend for that to be the case.
We don't intend to have slaves working for us. It's a problem that's very hidden deep within the supply chain. So when we purchase normal everyday items from reputable brands that we know and love, or when we invest in those same companies, we may be inadvertently benefiting from forced labor or even child labor. Wow.
Yeah. And most people have no idea this is going on. You mentioned the supply chain of products we may be buying today. What types of industries are we talking about, Rachel? Yeah, it's well known and well documented that certain industries are riddled with these complexities. For example, the coffee, chocolate, seafood and textile industries are all known for having slave labor issues deep in their supply chain. Imagine for me, just a moment, a farm in West Africa where they're growing coffee. And instead of seeing, you know, the typical workforce, the people actually out there picking coffee beans could be young children forced to work long hours and be exposed to toxic pesticides.
And, you know, coffee is something, I don't know about you, but something that I'd like to keep in my diet. So we have to work through these issues as investors and as consumers. Yeah. Well, it's exciting to know that faith-based investing is actually in part addressing this. We're talking today with Rachel McDonough, certified financial planner and certified kingdom advisor about faith-based investing, and we'll have much more just around the corner. Stick around.
Thank you. It's a huge problem today as Rachel said before the break, according to IJM, more than 50 million people around the globe are estimated to be enslaved more than any time in human history. And Rachel, you were sharing some of the industries where this slave labor is involved, and you mentioned chocolate and coffee.
Those certainly hit close to home. Why is this such an important part of their business model? Well, slave labor really is an issue of supply and demand. And when we create the demand, because we like to purchase items like chocolate and coffee, it creates a demand. And as shoppers, we like to have low prices. One of the things that keeps prices low is slave labor.
When you have dirt cheap labor, you're able to have a very competitively priced item on the shelf for a shopper to look at. And the same happens for investors, right? So if we kind of take our shopper role and switch to the investor role, when we're investing, low prices mean higher profit margins.
And when we keep buying and the profits keep going and the dividends keep growing, investors like to see that too, because the share prices are going up. And so inadvertently, without knowing or having any intentional malice, the attractiveness of these companies that have inexpensive labor, it just looks really good to portfolio managers and to investors who are unaware of the underlying issues. So either way, whether as shoppers or investors, that slave labor keeps the cost of goods low, drives up profitability, which we like as consumers and investors. And so it's really this win-lose supply and demand economic system where we're unknowingly creating demand and criminal middlemen are providing the supply of cheap slave labor.
Well, we need to shine a light on it as you're doing today, because as we said, most consumers have no idea this is going on in the supply chain of many of the products they're buying. Of course, many of our listeners, Rachel, give to nonprofits, and those are on the front lines in many cases of battling to end slavery. But you make the point that really that's not going to get it done with donations alone, is it?
That's right. And donations are an important place to start. But if we really want to see change, we have to change the way we shop and the way we invest. Human traffickers are 100% in it for the money. Human trafficking is extremely profitable business. The International Labor Organization estimates profits of $150 billion per year as of 2020.
And this criminal industry, of course, has only grown since then. So until the profit dries up and the money changes direction, this activity is going to continue. So it's about changing our buying habits, but also our investing. So let's get specific, Rachel.
What can Christians do about this? Yeah, on the shopping side, I have to be the first to admit that I'm really still learning. And it's important for us to continue sort of learning and researching and wrestling with these issues. But on the investing side, I have good news. There really are clear, actionable solutions on the investing side.
The databases already exist that track information about labor conditions and supply chains. And so I've heard people argue that it's not really perfect. We can't, of course, 100% guarantee that there is no profit coming from exploitation. But let's focus on the fact that there are these resources available and there is something that we can do about it. So while change can be uncomfortable and inconvenient, if we're willing to learn and research and understand the different options that are already out there, once the portfolios get updated, it takes very little effort to maintain. And there are also some wonderful low-cost options that are available. So if we can care enough to slow down, learn about the options, then that's really a positive way for us to show love to our exploited neighbors across the world by changing how we invest.
Yeah. And at the end of the day, Rachel, these faith-based investing companies are intentionally choosing companies to invest in that are creating value for their shareholders, but also where the supply chain does not include any of this forced labor. And I would imagine as capital is directed away from the companies that are using the forced labor, that's going to get their attention over time, right? It certainly does.
We saw that happen in South Africa with Taking Down Apartheid. It was really investors who caused a tremendous amount of change to come. So in our practice, we encourage all of our clients to align their investments with their values.
And freedom is, of course, one of the top values for many of our clients. The thing is, Rob, the investment approach for each investor depends on several factors. So there's not really a one-size-fits-all type of solution, but their preferences for risk, their need for liquidity, and the amount that they want to invest will determine the right style of investing for that client. So just as an example, the venture fund that I mentioned earlier is really only available to accredited investors who have, the simplified definition would just be they have around a million plus to invest. But there are also direct indexing type of solutions where investors can choose from a menu of both positive and negative screens, meaning things they want taken out or added into their portfolio. And those are typically available for investors with $250,000. And then there are also mutual funds and ETF investments that are ethically screened.
And those are available to investors of literally any size. Yeah, that's really great. Well, Rachel, we began this discussion today with the Christmas Carol. So during this season and heading into the new year, perhaps it's a great time to reassess our investments, isn't it?
It is. And especially when there's some market volatility like we've been seeing, there are often tax-savvy moves that an investor can make before year-end to take advantage of harvesting some of the tax losses out of their current investments that might be down. And then at the same time, repositioning into a portfolio that aligns with their values and helps to eradicate slavery. I love that. Well, we're about out of time, Rachel. I'd love for you to just tie a bow on this to continue our Christmas theme and maybe you can sum it up for us.
I'd love to. I would say in closing that even though slavery is highly profitable, it's obviously not the kind of profit we want. And when we join forces with heaven and with our Christian brothers and sisters around the world, we can help to break chains and cause oppression to cease. I just want to close with reading from Isaiah 61 one. The spirit of the sovereign Lord is on me because the Lord has anointed me to proclaim good news for the poor.
He has sent me to bind up the brokenhearted, to proclaim freedom for the captives and release from darkness for the prisoners. Rachel, I bet this is a brand new idea for many of our listeners and an exciting one, too. And I know you're excited about where this movement is headed in the future, aren't you? I sure am, Rob. Thank you so much for allowing me to share.
Absolutely. We appreciate you joining us today. Well, certified financial planner and certified kingdom advisor Rachel McDonough has been our guest today.
You can learn more about Rachel at WealthSQ. Thanks for joining us today on Money Wise Live. I'm Rob West, your host. We're taking your calls and questions now on anything financial. Let's turn the corner and answer your questions as we apply God's wisdom to the financial decisions and choices you're making every day. So what are you thinking about?
What would you like to talk about today? Our lines are open at 800-525-7000. Again, that's 800-525-7000 is the number to call. All right, let's begin in New Mexico. Hermo, thank you for calling.
How can I help you? Yes. My broker introduced me to a product, investment product. It's called fixed annuity accounts. Are you acquainted with this investment tool? So I know what a fixed annuity is. I'm not sure about the distinction on account. Is there something specific there? Okay, the short term is called fixed accounts.
It works like a CD, except this gives you greater gain than a CD. When I opened this one up back in July, the going rate was 4.15%. So I went ahead and opened it up with 75,000. At that going rate, it's a fixed rate. The yield is compounded monthly.
And then a couple of weeks ago, I went to see him just to get a feel. How is it doing? He looked it up and he said, okay, in four months time, it gained $1,026. And when you do the math, it pretty much averages out to about $250 a month plus change.
And I'm thinking, this sounds like it works good. Well, what is the yield on it currently? And it's good for five years.
Excuse me? What is the rate on it currently? Is that staying the same? Ah, he told me it went up. Now, if you invest at least 100,000 on up, it's at 5% now.
Yeah, okay. Yeah, so it basically is just a fixed annuity. Current rates right now are somewhere between 3.6 and maybe five and a quarter at the high end. Essentially, these are insurance contracts that pay a guaranteed rate of interest. So that's a good thing. What's the downside? The downside is they're illiquid. So you can't withdraw more than 10% a year without incurring a penalty typically. While it guarantees a certain rate of return, it also limits your returns compared to what you might have gotten otherwise in other investments. But you have to recognize, and I understand this, that you're taking more risk when you do that as well.
There's also a surrender period which could last as much as 15 years where you're going to pay a penalty for surrendering it. And they can have high fees and some complexity with them. So for those folks who want that guaranteed rate of return and want to transfer the risk to the insurance company and do that in a tax-deferred environment, that's where this can be effective. I would also say to you CDs, one-year CDs right now are paying four and a quarter. So you can get similar rates outside of an insurance product without all the complexities and surrender charges and losing access to your capital for quite as long as you might be in this particular product. And so for that reason, given those things, they're not my first choice unless someone just says, listen, I don't want a bank product, I don't want CDs or high-yield savings, and I don't want to take any risk. I just want to transfer that risk out to an insurance company, know what I'm getting by way of a return. And I'm happy with that. Then that's where a fixed annuity could make some sense.
It's just not for everybody for the reasons I mentioned. Okay. Sounds good.
Does that make sense? Yes, sure. Okay. Yeah, but it sounds like you're happy with it, so that's a good thing. And it's performing well as expected, so that is good as well. Keep in mind, upon withdrawal, the money is going to be taxed as income.
Did you purchase this with pre-tax or after-tax dollars? It's deferred. Okay. Yeah. They only send annual statements, and it gives you the amount of the gain interest, then you have to claim that.
Yes. So because they grow tax-deferred, you don't owe the taxes until you withdraw the money or begin receiving payments. But upon withdrawal, it's going to be taxed as income as you take it out, so you just need to be aware of that as well. Sounds like you're doing a great job with this, and I would just keep up with it as you have the ability to change to something else.
I would just take a look at it and make sure it's accomplishing the purpose for which you intended it. We appreciate your call today, Ermo. God bless you, sir.
800-525-7000 is the number to call. We've got several lines open here today on a Friday, Christmas right around the corner, a new year just beyond that. And we're talking finances today, recognizing our role as stewards. Hey, speaking of year-end, before we take our next break, let me just remind you, today is the last day to get in on our $50,000 match here at MoneyWise Media. We had a generous donor step up to say, I want to double the impact of every gift given this week.
Well, this being the last day of our broadcast week, this is the last day for us to claim 100% of that $50,000 match. So if you're a part of the MoneyWise family, maybe you count on this program each day, you listen with regularity in the app or through a podcast, or maybe tuning into Moody Radio in your car at work or at home, and you want to make a gift and help us double the impact as we claim this gift given by a generous friend of the ministry, just head to MoneyWise.org and click Give Now. It would go a long way toward helping us accomplish our year-end goals here at MoneyWise Media. It's a tax-deductible gift, and again, you can make it at MoneyWise.org. Every dollar matters, so whatever you can do, we'd say thanks in advance.
Again, MoneyWise.org, just click Give Now. All right, we're going to take a quick break. When we come back, we'll talk to Amber in Missouri and perhaps your question. 800-525-7000 is the number to call. Stay with us.
Much more to come just around the corner. I'm delighted to have you with us today on MoneyWise Live. I'm Rob West, your host. 800-525-7000 is the number to call. We'd love to hear from you today.
Hey, a quick email before we head back to the phones. These come to us at questions at MoneyWise.org. Allison writes, We are debt-free. We're trying to decide what to do with our disposable income. We have $15,000 in savings.
Do you have any advice? Well, first, Allison, way to go. Congratulations on becoming completely debt-free.
That's amazing. I think your first goal is to try to stay that way. With regard to the $15,000 you now have in savings, let's carve out, if you haven't already, three to six months expenses as your emergency fund with anything left over. If you have any kind of medium-term goals, maybe a car replacement or a down payment on a house, this would be a great kind of starting point for that separate savings that you're looking for. But beyond that, perhaps you fund a Roth IRA for this year. Maybe take $6,000 if you're married. You and your husband take $6,000 each and put that right into a Roth IRA and get that invested for your future. But congratulations, excited to hear that you're debt-free, and thanks for writing to us.
If you have a question you'd like read on the air, you can send it along to questions at moneywise.org. All right, let's head back to the phones. To Missouri we go. Hi, Amber. Thanks for calling. Go ahead. Hi, how are you? I'm doing great.
Thanks. Okay, so my question is I came into some money. I was injured, okay, and I had a settlement, and this company named Synergy had put me into this special needs pooled trust, and I was kind of tricked into getting put into this thing, okay? And so recently I just found out that the Synergy just had a huge lawsuit against them for putting people in special needs pooled trust and using their money for their own needs, like their own parties and luxuries and everything like that. And I've been told that Legacy Enhancement is my trust name, okay, and they are trying to tell me that it's not that trust and that I'm fine. So I really just don't know what to do about all of that and how to go about, you know, I mean, it's kind of a mess, really.
Yes, very good. Well, nearly every state's probate code includes the right to terminate a trust for a variety of reasons. So contrary to the name irrevocable, they're not always, and this one may or may not be, but this idea of a pooled trust is essentially where it's managed by a nonprofit instead of a single trustee, and then it's meant to protect the assets and then ensure that the individual can get government aid if needed. You know, the challenge is that the funds are not readily available to the grantor, the beneficiary, because they have to go through the trustee and be justified as reasonable and necessary and all of that. So I think your next step, Amber, if you'd like to try to get this money out of there, would be to consult with an estate planning attorney. Have you talked to an attorney about perhaps, you know, trying to get this money released from the fund?
You know, I have. I spoke a bunch, actually, because there's a lot more to all of this. And it's like I can't seem to find anyone, an attorney who will, I guess, take on my case because legacy enhancement has lied so many times.
And then it's like they told me to go to Synergy and then they tell me the Synergy tells me to go to talk to legacy enhancement and then vice versa, back and forth, back and forth. So it's like no one really wants to help me because it's such a complex situation, I guess you'd say. And so I just didn't know if maybe you had any suggestions on, I mean, I don't know what to do, really.
I mean, it's kind of a terrible situation. Yeah, it's going to require a legal professional walking alongside you, Amber, because they're going to have to petition a court to get you out of this. And so you're going to need somebody to represent you who has experience in disillusion, dissolving a trust, or at least in this case with a pooled trust, getting you out from it. So I think that is your next step is find somebody who'd be willing to take this on. Perhaps you could contact a certified kingdom advisor in your area at our website, moneywise.org, and then just ask for a referral to a godly estate planning attorney. You could also call your church and see if they might have somebody that they know. But I think that is your next step because this is not going to happen without some legal intervention.
And so you need somebody who understands these special needs trusts and in particular, the pooled versions of these and can help you navigate how, if possible, you can get out from under it. Right. Thank you. You're welcome.
I'm sorry I don't have a quick fix for you and all the best as you navigate this. Will I ask the Lord to give you some wisdom? Thanks for calling today.
To Arizona. Hey, Mike, thanks for calling. Go ahead, sir. Good morning. Can you hear me?
Good afternoon. Yes. Yeah, sure can.
Go ahead, Mike. So I've got two credit cards totaling about fifteen hundred dollars. I want to get out of them. One's at twenty nine percent. The other one's at like twenty six percent. My banker said he could loan me to pay him off at about eleven. Yeah. I feel like it's a good deal because it'll save me all that. I want to keep it revolving. It's the only debt I have, but I want to keep something revolving for my credit. I need your.
Yeah, very good. Well, you could set up a secured card, but if you've got one already, you might as well. You know, as long as once it's paid off, we'll talk about that in a second. You maybe set up a recurring transaction of something that's a budgeted item. Maybe it's six or eight or ten dollars a month.
You hits the account, you automatically pay it off, and that's going to keep that positive credit history flowing with regard to the paying off the debt. How much do you owe all in on these two cards? About fifteen hundred dollars. OK. And how much do you have per month to put toward this extra? So so I'm trying to put a bunch of cash away. I don't have any debt. And when I talk to the banker, he says we can set up a bi-weekly payment at about sixty five dollars, which won't hurt me at all. He said that'll free you, but that'll keep you in some open account, which is what I'm hoping.
I want to keep something open for my credit. Yeah, right. So you're going to send sixty five over and above the minimum payment? Is that your goal?
Bi-weekly? My payment. So to borrow the fifteen hundred dollars from the bank. Well, let's say you don't do that yet.
Let's say you leave it right where it is. How much do you have left over every month after the minimum payments on the credit cards and all your bills are paid that you can apply to debt reduction? I have quite a bit.
I must say like one hundred dollars. OK, well, if that's the case, I'm trying to nest egg that stuff to where I have, you know, six months free if I need it. And then some emergency money.
Yeah. With that four hundred, have you been able to bank any portion of that? Do you have anything in savings today? I do.
How much? I don't want to touch my savings. OK. All right. But what if we do this? What if you just freeze your savings and let's just pay it off right where it is?
I mean, you're going to have this thing knocked out in three months. Yeah, you'll save a few dollars in interest, but you won't have the hassle of creating the new account. Plus, there's probably some fees associated with getting that new loan in place. If you've got four hundred dollars a month, I want you to get to six months expenses also.
I like that idea. But let's get this paid off first and then take one hundred percent of that four hundred plus the minimum payments on the cards and put that toward the savings, but not do any more additional savings until the cards are paid off. I just think it's not worth the hassle and the cost associated with the new loan, not to mention the credit check and those types of things for you to get this new loan. You can have this paid off in less than four months.
I'd say stay right where you're at and just focus on getting this paid off as quick as you can. Let's talk a little bit more off the air and we'll be right back. Stay with us. Great to have you with us today on MoneyWise Live. I'm Rob West. Wow, time flies. It's already our final segment of the broadcast.
Eight hundred, five, two, five, seven thousand. I got choked up. I'm so excited about that. Thanks for being along with us today. Hey, it's Friday, which means our good friend Jerry Boyer joins us. Jerry is president of Boyer Research. He's an author. He's also a columnist at the Christian Post. And he joins us each Friday to weigh in on the markets and the economy, really looking at the news of the day through a biblical lens. And there's always news to react to.
So right this time of year, especially with the Fed action and inflation and the markets. And so in just a few minutes, we'll be talking to Jerry and get his perspective on everything that's going on. But in the meantime, let's head back to the phones to Canton, Ohio. Hi, John. Thanks for calling, sir. Go right ahead. Hey, yes, this is John and thank you for taking my call.
Sure. OK, the I my question is that we have some land that we've owned for about 40 years, originally bought for about twenty five thousand and sold this year for two hundred and approximately two hundred fifty thousand after expenses. And, you know, the real estate fees, you know, there might be two hundred and twenty thousand dollars as capital gains.
Now, I input that in a in a like an app and it looks like we're going to have some taxes between the federal and the state in Ohio. My question is, is there any better thing to do with this? I know. I don't even know if they have starter exchanges anymore. It's too late for that. Is there anything else better to do with this money? And then the other question is that we have part of this, too, is that we have a rental property and our own personal home. You might own about sixty thousand. Should we take this money and pay that off? Or what would you suggest if you have two hundred twenty thousand sitting in the bank?
Yeah. Well, so in terms of reducing the taxes, there really is nothing. I mean, unless you did a 1031 exchange where you sell a property and then reinvest it into a replacement property of a similar type. But it doesn't sound like you're looking to do that. The only other option would have been prior to the sale. You could have put a portion of it in a donor advised fund if you wanted to give some of it away. And then that portion wouldn't have been subject to the capital gains. But at this point, you're just going to have to pay those gains.
And then with what's left, tell me your options. Did you say you have a mortgage on two properties? Yes, there's a mortgage on a rental property and there's a mortgage on a personal home, which is about, I would say, a total of maybe sixty to seventy thousand. OK, so you owe sixty to seventy on your primary residence. That's probably on both of them. Oh, OK.
So altogether, the two mortgages are no more than seventy thousand, roughly. Right. OK. Yeah.
I mean, that seems like a no brainer. You could just wipe those out and be completely debt free. Apart from that, did you have any giving goals or any other goals?
Are you wanting to try to invest this for the future or what were you considering? Only to money wise. I like that, especially today.
You know, we have a dollar for dollar match, John. I know that. That's what I'm going to work on.
I got to get on that website if I can figure out how to do that. I love it. That's very kind of you. What else were you thinking about in terms of, so let's say you take, you know, you've got two hundred and thirty thousand. Let's say, you know, you pay the taxes, you end up with about one hundred and eighty five thousand or something like that.
And then you knock out these seventy thousand dollars worth of mortgages. You got a little more than one hundred grand left. Are you wanting to invest that or what are you thinking? Well, I have to talk with my wife, you know, and see what she thinks. But I you know, I think, you know, having it in the bank right now, I don't even know if it's making one percent.
So, you know, we've never been aggressive on investing. So but now that this has been settled, now we're thinking maybe we should do something. I mean, I'm 80. Yeah.
So how much longer am I going to last? I don't want my kids to fight over it. So.
Sure. Well, I think you've got a couple of options. I think depending on the risk level you want to take here, you could just put it into a high yield savings account at three percent with FDIC insurance. You could drop it into a CD, you know, paying four and a quarter percent for 12 months and just buy yourself some time.
But at least it's protected and you're getting a little bit of interest. Or you could connect with an advisor and look at perhaps putting this to work. You know, it's not a bad time to start a stock and bond portfolio, even if at your age you were to keep only 20 or 30 percent in stocks and take advantage of the recovery when it happens, even though it could go down a little bit lower from here. And the rest in Treasury bills, bonds and notes and maybe some high yield or high quality corporate bonds that are kind of shorter duration. But I think all of that would be predicated on you being comfortable with taking a little risk and getting with an advisor who could manage it.
You could find a certified kingdom advisor on our website at MoneyWise.org. But if you just don't want to do that, you guys just want to protect it. Then I think right now just take advantage of some of these higher interest rates and perhaps, you know, drop it into a CD for 12 months.
All right. What would you suggest? Like maybe the I bonds too or not? You could, but you can only put in, you know, 10,000 apiece. So you could put in 20,000 between you and your wife this year, another 20,000 next year.
You know, that's going to pay a pretty attractive rate, at least for the next six months, probably a decent rate after that. So that would give you 40,000, you know, protected. You'd have to leave it there for a year. So that would be an option.
And then the rest, maybe you put in a CD of some kind. I'd love for you to make sure you have at least six months expenses in a savings account. But perhaps you already have that. So, you know, I think those are your options if you want to stay on the most conservative end of the risk spectrum.
Apart from that, I think it would be to connect with an investment advisor who could build a portfolio where you had a little bit more growth potential with just taking a slightly incremental increase in risk. Does that make sense? Yes. Hey, I appreciate it. Thank you very much. All right, John. Thanks, my friend.
God bless you and Merry Christmas to you. 800-525-7000. Hey, before we go back to the phones, I think we do have Jerry Boyer with us. Jerry, good afternoon, sir. Hey, buddy. How you doing? I'm doing great.
It's good to have you here. Hey, we're heading toward year end. We've still got a lot going on in the markets. Been a busy week economically and data wise.
What do you have for us this week? Well, a lot of the data was kind of negative. And usually that means bad news is good news because, you know, the idea is that the economy is showing signs of recession and maybe the Fed will lighten up a little bit. But all of that was dwarfed by the fact that the Fed actually had its meeting and announced a rate hike. Now, that didn't make a lot of difference because everyone knew what the rate hike was going to be. 50 basis points.
There was no surprise there. All the markets had priced that in. The new thing was that the Fed releases this thing called a dot plot, which is basically a survey of members of the Fed. And it doesn't say, what will you vote for?
What do you think the policy should be? Instead, it is what do you think the committee that you're a member of will do in the future? So individual Fed members are predicting what the whole Fed will do. And, you know, they ought to have some expertise. They're there on the committee and they're talking to people. And those numbers were more for monetary tightening, moving more towards slowing the economy down, hiking interest rates, selling bonds, whatever you want to call it.
It's really all the same thing. So hawkishness. And so that really drove markets. The idea is the central bank is willing to risk a recession. I just saw the Fed chair of the Fed member from Cleveland, Mester on Bloomberg just a few minutes ago. And it's very clear they know that they may well be triggering a recession. They are intentionally slowing down the economy because their Keynesian economic system thinks that growth is inflationary and the way to fight inflation is to slow down the economy. Of course, that's nonsense. Four thousand years of economic knowledge knows that growth helps fight inflation.
Right. If you have too much money chasing too few goods, then you want more goods, more goods makes the price of things drop. But we've got a you know, because of the worldview shift in the 20th century away from classical economics, which I think was grounded in a biblical worldview towards the new economics, which is grounded more in manipulation. They think that so they are intentionally this is not me interpreting.
They know they're putting paint on. They're going to try to raise the unemployment rate so that we don't have as much bargaining power as employees because they think that's the way to stop inflation. And how do the markets react? Exactly the way you'd expect. The Fed funds futures went up. They said, OK, you're telling us what you're going to do.
We believe you. We think you're going to hike more stocks sold off. We saw that stocks sold off more than bonds. That's a classic anti growth trade. And the riskier bonds sold off more than the not so risky bonds and the riskier stocks, you know, like cyclicals sold off more than the safer stocks like utilities or health care. All the trades were anti growth. So basically the market said to the Fed, OK, we hear you. You're you're steering us towards a recession because you think that's how you have to fight inflation. We're taking you seriously. And the market pretty much all the trades were consistent with that premise. Yeah, we certainly saw that playing out.
Well, Jerry, it sounds like same song, second verse. We're just going to continue this theme, I think, right into the new year. And we'll just continue to watch the Fed because it seems like that's really the primary driver of everything today. Hey, grateful for you, my friend. I know Christmas is right around the corner and this is perhaps the last time we'll talk this year. So Merry Christmas to you and we'll look forward to talking to you in a new year. OK. And Merry Christmas to you and yours. All right. God bless you, Jerry.
Jerry Boyer, president of Boyer Research and a columnist at The Christian Post. Quickly to Chicago. Sue, I have just about 45 seconds. Give me your question quickly. OK. For those of us who are sort of 60 plus, we're used to getting bank statements and papers in the mail. So online banking, bill paying, direct deposit, online savings is, you know, a little daunting or we have fears about it. Can you either give encouragement or caution?
Yeah, I can. I think there's a way to do this responsibly. You're never going to be completely insulated. But here's a few tips. Don't open mail from strangers, whether that's a phone call, a letter or an email. Don't click on any links. Make sure your device is up to date. Use two factor authentication.
You can read about that online and don't use public Wi-Fi. I think if you use those things, you'll be headed in the right direction. I wish I had more time for you, Sue, but appreciate your call today. God bless you. Hey, thanks for joining us today. MoneyWise Live is a partnership between Moody Radio and MoneyWise Media. Thank you to Courtney and Jim. We're grateful for you being here as well. Tahira as well.
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