Good afternoon,
Only a couple of weeks until the MOST IMPORTANT ELECTION IN OUR LIFETIME. Or least the most important election until the next one. I’ve said before, and I stand by it, that no matter which team prevails, half of the country will be upset, the losing side supporters will cry in their Starbucks, pundits will abound to tell us why the world is ending and markets will react one way or the other. Then again, markets always react one way or the other and their reaction is always temporary. The world will not end in two weeks, or anytime thereafter, and in 4 short years we’ll get to go through this entire circus again. It’s the worst election system in existence, except for all the others. It reminds me of that scene in the movie Birdcage where the Gene Hackman character and his wife are watching a Sunday morning political TV show and all the panelists are shouting over each other at the same time. Hackman’s character remarks “it’s the most intelligent show on television.” Ha!
See attached for a piece from Vanguard about how elections matter. But not so much to your investments.
And speaking of your investments (nice segue, wasn’t it?) now is the time to start thinking about year end maneuvers and strategies. Hard to believe that we’re coming up on the end of the year, but here we are. So you’ll need to consider things like gains and losses for tax purposes, retirement plan contributions, charitable contributions, asset allocation and asset location. Call if you want some help going over this. And speaking of getting some help, I was introduced to a friend of a client last week who wanted to talk about their circumstances. Terrific, I’m happy to help, I told them. I continued with a brief introduction: Our chat will last 30-40 minutes, everything we discuss is confidential and at the end of the chat we can talk about how to move forward or not. May I ask you some questions? “Ok, what kind of questions?” We’re going to discuss your F.O.R.M. Family, occupation, recreation and money. In that order, and I just need to know what’s on your mind in those areas. Is that ok? “Sure, that would be fine.” Great, thank you.
Do you play the lottery? Me neither. Generally speaking, lotteries are a tax on people who can’t do math.
Lottery sales are down this year so officials are trying to figure out ways to get more players. Lotteries qualify as a regressive tax, meaning that they disproportionately affect lower income people. Income tax, on the other hand is progressive. The more you make, the more you pay. Lotteries, like other forms of gambling, can be fun, but they should be viewed as entertainment and should only be played with money you can afford to lose.
https://www.cnbc.com/2020/10/19/why-powerball-mega-millions-jackpots-arent-at-giant-amounts.html
If I did play, and by chance win, a lottery, I would spend some of the spoils on a car collection. Certain cars for sure, a first generation Chevy Camaro, a 1972 Corvette Stingray, a Porsche 911 cabriolet, a Porsche Taycan, a supercharged GMC Yukon, perhaps even a Tesla.
And probably this new Hummer from GM.https://www.cnbc.com/2020/10/21/gmc-hummer-ev-5-things-to-know-about-gms-first-electric-supertruck.html
Here is a supercar that is cool and fast. It just set a speed record for a production car, but I’m not sure I’d want one even if I could afford it. I appreciate it, but would choose others first, that’s just my opinion.
https://www.foxnews.com/auto/american-ssc-tuatara-supercar-316-mph
And speaking of car collections, here are a couple of good ones.
Jay Leno, https://blog.dupontregistry.com/jay-lenos-garage/jay-lenos-car-collection/
Jerry Seinfeld, https://www.thethings.com/facts-people-tend-to-forget-about-jerry-seinfelds-car-collection/
I guess that practicing successful comedy over the course of many decades pays off handsomely. At least it did for Leno and Seinfeld.
Is it me or is this more than a little ironic? The Rockefeller family heirs (some of them) say that banks should stop lending to fossil fuel companies. They prefer renewable sources like wind and solar. Which, by the way are becoming more prevalent not because the greenies insist on it or laws mandate it, but because they are finally becoming economically viable. The Rockefeller progeny have the luxury of lecturing the world from a perch built on the wealth created by Standard Oil, the company that John D. Rockefeller founded. Hmmm. In America, they are allowed to say anything they’d like. And of course, I am of the opinion that people should be free to spend their money in any legal manner they prefer, so rather than giving speeches maybe those unhappy Rockefellers should put their money where their mouths are and invest in whatever industries they are trying to promote. Just a thought.
Essays, essays and more essays. My high school senior daughter is in the midst of applying to various colleges for admission next year. Just like her big brother did a few years ago and just like her little sister will do in a few years from now. She completed the common app which is a blanket application that goes to most every school. Filling out the various sections, classes, extracurriculars, interests, awards, etc. Writing and re-writing the common app essay. And then some of the schools want an additional supplemental essay, so she writes and then rewrites those essays as well. Usually they helpfully offer prompts about potential topics. Sometimes they say why do you want to come to Our Great University? Sometimes they say, tell us something interesting about yourself. Sometimes they ask how will you make the world better when you graduate from Self Important Expensive Private College? Sometimes they say, write about a meaningful class/job/position/teacher/coach/team/whatever that has impacted your life and tell us why. Considering herself fairly clever, my young prodigy actually wrote an essay about how difficult it is to write all these various essays. How agonizing it is to choose a topic, is it appropriate, is it interesting, how can I make it different, how can I stand out, and so forth. She showed it to me upon completion and unsurprisingly, it is pretty well written. I told her that as much as I think the topic means to her and how well written it is, it is probably not what you want to send to a college if you actually want to be admitted to that college. Scolding them for the process they’re using to admit you may not win any brownie points. Ever heard that theory along the lines of if you can’t say something nice, then don’t say anything? Submit the paper for credit in your high school literature or writing class, but you may want to hold it back from the common app. Let’s see if we can find something else that you’re equally passionate about.
Regular readers will know that I can’t mention college without going on a slight rant. I did it a few years ago as my son was matriculating so I won’t repeat an entire diatribe here, but…College is not always for everyone and that’s fine. Lots of smart, successful people do lots of smart, successful things and lots of times they never went to college. Notice I didn’t say that they don’t continue to LEARN, they just don’t need a college classroom to do it. And don’t even get me started on how absurdly expensive the whole process has become. It’s not difficult to explain why, but I’ll save that for another day. That should change soon however. Even before covid, there was a limitless amount of learning going virtual. Now we know that nearly all of it can be done that way. Yeah, yeah, I understand that college isn’t just about the classes, it’s about socialization and youngsters getting away from the nest and blah, blah, but they can also save tens of thousands or hundreds of thousands of dollars by picking up some books or taking online classes on their own. Inhale, hold, exhale, ok, I feel better now. Maybe in the future, I’ll spend some time explaining how to fix our health care system, stay tuned.
Since we mention cars in our message, this week’s chuckle is from the 80’s TV show “Taxi.” Enjoy Reverend Jim taking his taxi driver license test. Safe for work.
https://www.youtube.com/watch?v=39k067hcgYY
LF26 – “If everything seems under control, you’re just not going fast enough.” – Mario Andretti.
Have a great week and stay healthy.
The opinions expressed are those of Michael Acho and not necessarily those of Lincoln Financial Advisors Corp. CRN-3295850-102120
Michael J. Acho, MBA, CFP®
Private Wealth Advisor
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