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Stocks, Social Security, and Bitcoin in El Salvador: Community Conversations


Even though the high season for amusement parks is over, the roller coaster that is the stock market continues to give investors a boost.

Photo Illustration by Staff; The time of dreams

Higher than expected consumer prices in August sparked Tuesday’s market bloodbath, the worst day for the three major US stock indices since June 2022 as the Nasdaq plunged 5.2%, the S&P 500 fell 4.3% and the Dow Jones Industrial Average fell 3.9%.

The shares rose slightly on Wednesday, but were down on Thursday afternoon.

Whether stocks rise or fall next, volatility will likely persist this year and in such an environment, dividend producers and alternative investments could reward investors.

At least this year’s market carnage should prove beneficial for young investors who can buy and hold for decades. However, for those nearing retirement, it’s a whole different story, especially when you take into account the impact of soaring inflation. Many are now wondering if they should postpone their retirement. Advisors share their suggestions.

The timing of retirement is inexorably linked to when someone applies for social security benefits. It is also the most important decision for retirees. In making this calculation, retirees must weigh the pros and cons of waiting longer for a larger check versus receiving smaller payments sooner.

This week, we learned that retirees could soon get their biggest increase in Social Security in over 40 years. This is good news for Social Security recipients, although some may expect higher taxes due to the annual cost of living adjustment (COLA) which moves them into higher tax brackets. Readers let loose:

Ashok Arora: “With this magnitude of the increase in COLA, the Social Security program is going to be even more accentuated. It is expected that benefits will be reduced by ~2035, I assume that with this type of increase of COLA, we could lose a few months/years. Congress needs to solve the SS problem now rather than later. But with today’s politics, no one wants to be the first to touch it. That’s where we we need leadership!!!”

Edward Palumbo Jr.: “Wait for the increase in the price of health insurance, then tell me about the big increase, then tell me again how the employees, despite their salary increases, cannot keep up with inflation. What a joke all this is!

Claudia Chapman:Elsewhere in Barron’s today, we see that the cost of groceries needed to make a typical egg, bacon, and toast breakfast has risen 22% over the past year. Suddenly, that 8.7% increase in Social Security loses some of its luster.

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There is a talent shortage. How Consulting Firms Extend Their Resources. In a recent Big Q, we asked six wealth management leaders: What steps have you taken to be able to serve more customers without necessarily adding more people. Companies said they relied on technology, streamlined processes and employee specialization to increase efficiency. Instead, commentators have focused on the value advisors provide:

Joe Grant: “The rule of thumb when working with these types of funding is passive indexing (outside of their system…so no ‘Merrill Edge’), for example with a Vanguard S&P 500. Then compare what they do for you over passive income Most of my friends do better without any advisors.

Brad Ducoat versus: “So your friends have the wrong advisors. Everyone talks about the 80% who don’t beat their appropriate index. What about the 20% who do?”

to which, Rachel Stultz asked: “@BradDucoat – As far as anyone’s ability to correctly identify an outperforming advisor (over a full market cycle, like a 10-year period)… do you do your due diligence by asking for their personal portfolio returns going back to 10 years?I would definitely try to avoid hiring a Chase Coleman/Cathie type investor (who outperforms for several years due to holding some stock flavor) so I would probably ask to see the holdings too? Honestly, I was wondering what you would ask… Thanks!

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Bitcoin bombed in El Salvador. This is a cautionary tale for crypto. The country made history last September when its President, Nayib Bukele, signed the Bitcoin Law, becoming the first country to fully legalize crypto for home use. In addition to embracing bitcoin, El Salvador rebranded itself as a tech-friendly country, but things haven’t been going well so far, writes Sabrina Escobar, who visited the country to assess bitcoin’s impact. for a certain time. Barrons cover story.

John Fisher: “It was completely predictable. Imagine what would happen if the US dollar only fluctuated a small percentage of the degree Bitcoin does. Total chaos. Combined with the insane environmental damage caused by these nonsensical cryptos, this should be a lesson to anyone who thinks this “currency” has a place in serious financial systems. Hopefully the SEC and/or Congress will finally enforce some common sense crypto regulations.

Doug Anderson: “Central banks don’t like it. Why? This constitutes a threat to their control over the money, therefore over the people. Most of us reading this article know the score and mostly accept the realities of the world we live in. Having BTC in the market provides, if only a tiny amount, a window with a view inside the coins where all the decisions are made. I take that as an advantage. »

Jon Chaay:Very well written and informative story. Clear explanations too. Excellent.”

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Please check Previous Community Conversations and feel free to share your thoughts below.

Write to Greg Bartalos at [email protected]

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