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My favorite productivity coach of all time is David Allen, famed author of Getting Things Done.

Absolute Financial Freedom BookWhen you first work with David’s concepts and materials, you think it is all about optimal levels of productivity…but you soon realize his methods also have a wonderful way of unleashing you from all the complexity and worry that often accompanies high levels of achievement.

In one of his audio recordings, he says: “Too controlled is out of control” and this immediately resonated with me. Actually, it articulated the “sweet spot” I have always aimed for as I created (and ultimately patented) Systems and Methods for Optimizing Wealth and most all of the other wealth and investment management systems, structures, support and tools I’ve created over the years. I always have heard that you can have a form of “unconscious competence” that serves you, but you can typically build upon it at an even higher level when you become aware of it and it becomes “conscious competence” – this was the case for me with this concept.

Whether you are seeking to better invest your money or seeking to be a better “depletion-resistant” wealth steward, my advice is to keep the “too controlled is out of control” insight in mind. Here are some tips:

“People only see what they are prepared to see.”
     -Ralph Waldo Emerson

On Thursday, investors will get a first look at Q1 GDP that is unlikely to impress.  According to Bloomberg, economists expect Q1 economic growth of just 0.6%, and it’s possible we could even see a negative number.  However, the intelligent investor won’t overreact, especially given the recent issues in reporting Q1 GDP data.

JC Blog 4.28

We first wrote about the anomaly in Q1 GDP data back in July 2015.  Simply put, research from the Federal Reserve seems to indicate persistent errors in first quarter GDP reporting.  According to a study by CNBC that looked back to 1990, these errors average out to GDP revisions as large as 1.3%.  In other words, a 2.0% GDP figure could ultimately be revised to anywhere from 0.7% to 3.3%.  Even the Bureau of Economic Analysis, the government body in charge of GDP data, acknowledges issues.

The turmoil in the energy sector was widely publicized since the historic decline of prices starting mid-2014. This has largely been due to a glut of oil in the market with relatively flat demand.
As a result, the energy sector was plagued with volatility and decreasing prices as investors fled for safety.KK Blog 04.22

This negative sentiment has spilled over into what should be an uncorrelated segment of the energy industry: mid-stream providers. Think of mid-stream as an infrastructure of toll roads that transport and store units of energy, not just oil. As Jim Callahan discussed in his latest edition of Portfolio Matters, the U.S. pipelines currently transport 70% natural gas and 30% oil. The demand globally for oil has decreased the volume of oil flowing through pipelines, but natural gas production is growing. The Energy Information Administration, estimates that natural gas consumption will increase by 60% on a global basis by 2040. The U.S. is the largest producer and exporter of natural gas and estimates point towards an increase in volume of 9% in 2016. While oil gets all the press, we remind our clients that its natural gas that is more important to the U.S. mid-stream MLPs, and because of this, we are very comfortable with our mid-stream focused investment thesis.

In a recent investment meeting, a client asked me about one of his holdings that has declined in value over the last year.  After hearing my response as to why we own the position, the client said  dismissively, “Well that sounds great, but if I asked another advisor and get the total opposite opinion.  So that’s where I’m stuck, trying to choose between opinions, because the marketplace is really just a collection of opinions.”

I’ve been thinking about this statement for a while because it’s both correct and incorrect on so many levels.  Let me explain.

Wealthy families or their advisors rarely appreciate hearing the term “generation-skipping transfer tax” (GSTT) The nuances of this specific tax law can be quite complicated, but there’s a reason Brady Blog 04.07.16for it: families and individuals often enjoy giving from one generation to the next, and the GSTT offers a fixed rate that ensures such gifts are taxed appropriately.

There is a recent study from Boston College’s Center on Wealth and Philanthropy, an estimated $59 trillion will be transferred from 2007 to 2061. While not all of that is subject to the GSTT, it does illustrate how important such a tax is today – and will become for the future (simplistically thinking about our federal deficit and the upward trending expectations for servicing our debt through higher taxes—the government will get their cut!).

The Department of Labor (DOL) will be coming out with a major decision next week that will effect virtually all financial professionals and clients, as they provide guidance that addresses the most
important decisions of our financial lives; what to do with clients 401(k) once they retire.   Retirement investors are harmed – primarily in the form of higher costs and lower retirement savings –
DOLwhen they receive conflicted advice that puts the adviser’s interest ahead their own.

By requiring fiduciary accountability for all advice related to retirement assets, the rule will provide much needed protections to help retirement investors navigate the complex and confusing financial services marketplace.
For many Americans, whether to rollover and how to invest their retirement nest egg, is one of the most important financial decisions they will make as there is more than $14.4 trillion of retirement assets in 401(k) plans and Individual Retirement Accounts (IRAs).  Under the current regulatory framework, all advisers are not required to make rollover IRA recommendations in their clients’ best interest, leaving Americans subject to conflicted advice related to their retirement savings.

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