Nurturing Financial Freedom

In this episode of Nurturing Financial Freedom, we shift focus from the hard numbers and take a deep dive into the psychological side of investing. Specifically, we explore loss aversion—the human tendency to feel the pain of financial loss more intensely than the pleasure of gains. As we've all seen in our work and our own portfolios, emotional reactions to market swings can often lead to irrational decisions. That's where understanding behavioral finance becomes a powerful tool in making smarter financial choices.We start with Ed breaking down the origins of loss aversion, rooted in the research of Kahneman and Tversky. Their work in the 1970s, which led to the development of prospect theory, shows that the average person perceives a $100,000 loss as twice as painful as a $100,000 gain is pleasurable. This cognitive imbalance causes two major pitfalls: people either avoid risk entirely and park money in cash—letting inflation erode value—or they panic-sell during downturns and miss out on rebounds, effectively locking in their losses.Ed walks us through real examples, including the volatility of April 2024, the pandemic crash of 2020, and the 2008 recession. He explains how our amygdala, hardwired to detect threats, doesn't differentiate between a market dip and a life-or-death situation, making our emotional reactions feel justified—even when they're counterproductive.Alex builds on this by offering techniques to manage this psychological bias. First, we need to build a financial plan with a properly diversified portfolio aligned to our specific timeline and goals. He emphasizes reframing our perspective—looking at a portfolio not as a cash balance but as ownership in companies that will likely be around for decades. He shares the analogy of home values: we don't sell our house when its Zestimate dips; likewise, we shouldn't rush to sell stocks when they temporarily fall.Other actionable strategies include pre-committing to actions like rebalancing during downturns, increasing contributions when prices are low, and resisting the urge to act impulsively. He underscores the power of long-term thinking—"expand the graph"—to see that every crash looks like a blip over decades. And finally, he recommends examining past mistakes. Nothing hits home more than seeing the dollars lost from a past panic sale.We close by reaffirming that while we can't guarantee outcomes, we can plan for volatility. The market is emotional in the short term but logical in the long term. With the right mindset and tools, we can better navigate the emotional terrain of investing and avoid letting fear dictate our strategy.Books Mentioned:Thinking Fast and Slow: https://www.amazon.com/Thinking-Fast-Slow-Daniel-Kahneman/dp/0374533555The Undoing Project: A Friendship That Changed Our Minds: https://www.amazon.com/Undoing-Project-Friendship-Changed-Minds/dp/0393354776 You can always email Alex and Ed at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://www.birchrunfinancial.com/Alex and Ed's Book: Mastering The Money Mind: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal/dp/1544530536 Any opinions are those of Ed Lambert Alex Cabot, and Jon Gay and not necessarily those of RJFS or Raymond James. The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. There is no assurance any of the trends mentioned will continue or forecasts will occur. The information has been obtained from sources considered to be reliable, but Raymond James does not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. The examples throughout this material are for illustrative purposes only. Raymond James does not provide tax or legal services. Please discuss these matters with the appropriate professional. Diversification and asset allocation do not ensure a profit or protect against a loss. Past performance is not indicative of future returns. CDs are insured by the FDIC and offer a fixed rate of return, whereas the return and principal value of investment securities fluctuate with changes in market conditions. The S&P 500 is an unmanaged index of 500 widely held stocks that is generally considered representative of the U.S. Stock Market. Keep in mind that individuals cannot invest directly in any index, and index performance does not include transaction costs or other fees, which will affect actual investment performance. Individual investor's results will vary. This information is not intended as a solicitation or an offer to buy or sell any security referred to herein. Future investment performance cannot be guaranteed, investment yields will fluctuate with market conditions. International investing involves special risks, including currency fluctuations, differing financial accounting standards, and possible political and economic volatility. There is an inverse relationship between interest rate movements and bond prices. Generally, when interest rates rise, bond prices fall and when interest rates fall, bond prices generally rise. Investing in small cap stocks generally involves greater risks, and therefore, may not be appropriate for every investor. The prices of small company stocks may be subject to more volatility than those of large company stocks. Securities offered through Raymond James Financial Services, Inc. Member FINRA/SIPC. Investment advisory services offered through Raymond James Financial Services Advisors, Inc. Birch Run Financial is not a registered broker/dealer and is independent of Raymond James Financial Services. Birch Run Financial is located at 595 E Swedesford Rd, Ste 360, Wayne PA 19087 and can be reached at 484-395-2190. Any rating is not intended to be an endorsement, or any way indicative of the advisors' abilities to provide investment advice or management. This podcast is intended for informational purposes only.Links are being provided for information purposes only. Raymond James is not affiliated with and does not endorse, authorize, or sponsor any of the listed websites or their respective sponsors.Raymond James is not responsible for the content of any website or the collection or use of information regarding any website's users or members.

In this episode, we walk through a tumultuous April marked by heightened market volatility, significant tariff announcements, and growing concerns about inflation and recession risk. Alex kicks off by breaking down what happened in the markets. The month began with what initially looked like a standard correction, but quickly escalated into what he describes as a crash. On April 2nd, the administration announced far more aggressive tariffs than anticipated, especially targeting Chinese imports. The shock triggered a sharp market drop—more than a thousand points lost over two days. The volatility stemmed largely from the ambiguity those tariffs introduced, making it difficult to accurately value stocks and project cash flows. As Alex explains, investor confidence suffers when assumptions about capital costs and future growth become too uncertain to model.Despite the chaos, we emphasize the importance of staying invested. Alex reminds us of our previous discussions about how the best up days in the market often follow the worst down days—something we saw play out just days after the tariff announcement when markets rebounded sharply after a partial rollback on April 9th. That pattern is why timing the market remains a losing game.We also touch on the importance of client communication during turbulent periods. Alex and Ed talk about the proactive steps they took to prepare clients, including emails, webinars, and consistent messaging. This transparency helped reduce panic and reinforce the value of long-term planning.Ed then walks us through where we stand now. While the most extreme tariffs were pulled back, the new baseline is still historically high, with a 10% tariff on all imports and 145% on imports from China. These will likely impact consumer prices starting this summer, especially on goods like food or chemicals tied to supply chains in China. We're now facing the highest average tariff rate in a century.He also addresses the rising recession odds, now between 40–60% according to major banks—well above the post-war average, but still no guarantee. Economic forecasting, as he notes, is often no more reliable than market prediction. Finally, we explore the Fed's precarious position: hold rates and risk slowing growth, or cut rates and risk fueling tariff-driven inflation. Either choice comes with real trade-offs.We close by reinforcing the message we always deliver—don't try to outsmart the market. Stick to your long-term plan, stay diversified, and prepare for storms before they hit. That's what we've always done, and it's what we'll keep doing. You can always email Alex and Ed at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://www.birchrunfinancial.com/Alex and Ed's Book: Mastering The Money Mind: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal/dp/1544530536 Any opinions are those of Ed Lambert Alex Cabot, and Jon Gay and not necessarily those of RJFS or Raymond James. The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. There is no assurance any of the trends mentioned will continue or forecasts will occur. The information has been obtained from sources considered to be reliable, but Raymond James does not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. The examples throughout this material are for illustrative purposes only. Raymond James does not provide tax or legal services. Please discuss these matters with the appropriate professional. Diversification and asset allocation do not ensure a profit or protect against a loss. Past performance is not indicative of future returns. CDs are insured by the FDIC and offer a fixed rate of return, whereas the return and principal value of investment securities fluctuate with changes in market conditions. The S&P 500 is an unmanaged index of 500 widely held stocks that is generally considered representative of the U.S. Stock Market. Keep in mind that individuals cannot invest directly in any index, and index performance does not include transaction costs or other fees, which will affect actual investment performance. Individual investor's results will vary. This information is not intended as a solicitation or an offer to buy or sell any security referred to herein. Future investment performance cannot be guaranteed, investment yields will fluctuate with market conditions. International investing involves special risks, including currency fluctuations, differing financial accounting standards, and possible political and economic volatility. There is an inverse relationship between interest rate movements and bond prices. Generally, when interest rates rise, bond prices fall and when interest rates fall, bond prices generally rise. Investing in small cap stocks generally involves greater risks, and therefore, may not be appropriate for every investor. The prices of small company stocks may be subject to more volatility than those of large company stocks. Securities offered through Raymond James Financial Services, Inc. Member FINRA/SIPC. Investment advisory services offered through Raymond James Financial Services Advisors, Inc. Birch Run Financial is not a registered broker/dealer and is independent of Raymond James Financial Services. Birch Run Financial is located at 595 E Swedesford Rd, Ste 360, Wayne PA 19087 and can be reached at 484-395-2190. Any rating is not intended to be an endorsement, or any way indicative of the advisors' abilities to provide investment advice or management. This podcast is intended for informational purposes only.Links are being provided for information purposes only. Raymond James is not affiliated with and does not endorse, authorize, or sponsor any of the listed websites or their respective sponsors.Raymond James is not responsible for the content of any website or the collection or use of information regarding any website's users or members.

In this episode of Nurturing Financial Freedom, we dive headfirst into the recent stock market volatility and explore what's driving it—and more importantly, how investors should respond. We tackle the question on everyone's mind: "What the heck is going on with the market?"Ed kicks things off with a breakdown of recent market activity, noting that since the February 19 peak, the market has dropped roughly 9.5% as of April 1. He explains that this pullback is largely driven by elevated stock valuations and policy uncertainty. The S&P 500's forward P/E ratio is sitting well above its 30-year average, which has made the market more sensitive to any negative headlines. Add to that the confusion surrounding tariffs and trade policy—especially whether these moves are part of negotiation tactics or a longer-term shift toward protectionism—and we're looking at a market trying to digest a lot at once.Ed emphasizes the importance of sticking to a well-diversified portfolio and keeping allocations aligned with long-term goals. If your portfolio has drifted because of recent gains or losses, now is the time to rebalance. We revisit the idea of “fire drills,” a proactive approach Birch Run uses with clients to prepare for downturns before they happen.Alex then provides some critical historical perspective. He reminds us that every downturn—whether it's the Panic of 1907, the crash of 1929, or COVID in 2020—has been temporary. The key takeaway? Don't let short-term fear drive long-term mistakes. He shares how missing just the 10 best market days over a 30-year span could slash an example portfolio growth by nearly $1 million. And since many of those “best days” tend to cluster around the worst ones, jumping in and out of the market is a dangerous game.Alex and Ed both stress that timing the market is not only incredibly difficult (if not impossible), but often detrimental. Staying invested with a balanced strategy that fits your goals is almost always the right approach. While we can't predict where the market will go in 2025, we can recommend avoiding behavioral traps and sticking to the fundamentals.Listen through to the end of the show to hear how ice cream ties in to all of this. You can always email Alex and Ed at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://www.birchrunfinancial.com/Alex and Ed's Book: Mastering The Money Mind: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal/dp/1544530536 Any opinions are those of Ed Lambert Alex Cabot, and Jon Gay and not necessarily those of RJFS or Raymond James. The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. There is no assurance any of the trends mentioned will continue or forecasts will occur. The information has been obtained from sources considered to be reliable, but Raymond James does not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. The examples throughout this material are for illustrative purposes only. Raymond James does not provide tax or legal services. Please discuss these matters with the appropriate professional. Diversification and asset allocation do not ensure a profit or protect against a loss. Past performance is not indicative of future returns. CDs are insured by the FDIC and offer a fixed rate of return, whereas the return and principal value of investment securities fluctuate with changes in market conditions. The S&P 500 is an unmanaged index of 500 widely held stocks that is generally considered representative of the U.S. Stock Market. Keep in mind that individuals cannot invest directly in any index, and index performance does not include transaction costs or other fees, which will affect actual investment performance. Individual investor's results will vary. This information is not intended as a solicitation or an offer to buy or sell any security referred to herein. Future investment performance cannot be guaranteed, investment yields will fluctuate with market conditions. International investing involves special risks, including currency fluctuations, differing financial accounting standards, and possible political and economic volatility. There is an inverse relationship between interest rate movements and bond prices. Generally, when interest rates rise, bond prices fall and when interest rates fall, bond prices generally rise. Investing in small cap stocks generally involves greater risks, and therefore, may not be appropriate for every investor. The prices of small company stocks may be subject to more volatility than those of large company stocks. Securities offered through Raymond James Financial Services, Inc. Member FINRA/SIPC. Investment advisory services offered through Raymond James Financial Services Advisors, Inc. Birch Run Financial is not a registered broker/dealer and is independent of Raymond James Financial Services. Birch Run Financial is located at 595 E Swedesford Rd, Ste 360, Wayne PA 19087 and can be reached at 484-395-2190. Any rating is not intended to be an endorsement, or any way indicative of the advisors' abilities to provide investment advice or management. This podcast is intended for informational purposes only.Links are being provided for information purposes only. Raymond James is not affiliated with and does not endorse, authorize, or sponsor any of the listed websites or their respective sponsors.Raymond James is not responsible for the content of any website or the collection or use of information regarding any website's users or members.

After sending congratulations to the Super Bowl champion Eagles, today we dive into a dense and important topic: the U.S. federal debt. There's a lot of fear and misinformation around this issue, so we break down what the numbers really mean and how they compare to history.Alex kicks things off by clarifying key terms. A deficit occurs when the government spends more than it brings in during a given year. The debt is the accumulation of all past deficits, minus any surpluses. The U.S. has run a deficit in 46 of the last 50 years, meaning it consistently spends more than it collects in revenue. To cover these shortfalls, the government borrows money by selling treasury securities to investors, institutions, and foreign governments. The debt's significance is often measured against the country's total economic output—its debt-to-GDP ratio—which has averaged about 64% since 1939 but has spiked dramatically at key moments in history.We've seen two major surges in debt-to-GDP: during World War II, when it reached 120%, and during COVID-19, when emergency spending pushed it to 125%. While this ratio has come down slightly since the pandemic, it remains historically high. Similarly, the deficit-to-GDP ratio, which measures the size of the annual shortfall relative to economic output, has averaged 3.4% over time but ballooned to around 6.4% in recent years.Ed walks us through the current numbers. As of 2025, the U.S. total debt stands at $36.2 trillion, with about $28.9 trillion held by the public and $7.3 trillion held by government programs like Social Security. Given that GDP is around $29 trillion, our debt-to-GDP ratio sits at 120%, nearly double its long-term average. The U.S. ran a $1.8 trillion deficit in 2024 and is on track for a similar shortfall in 2025. Experts believe a sustainable deficit level should be closer to 3% of GDP, meaning we'd need to close a $1 trillion annual gap through tax increases, spending cuts, or a mix of both.A common concern we address is the idea that foreign nations “own” the U.S. through debt holdings. In reality, only about 23% of U.S. debt is held by foreign countries, with Japan and China being the largest holders. However, they invest in U.S. debt not to control us but because U.S. treasuries are among the safest assets in the world.So, should we be panicking? Not necessarily. As Ed reminds us, people have been warning about a debt crisis for decades. Ross Perot famously made it a central issue of his 1992 presidential campaign when the debt was just $4 trillion.  And yes, we may have detoured for a moment into Ross Perot and "Dana Carvey doing Ross Perot" impressions.Today's debt and deficit numbers are bigger, but so is the U.S. economy. While the current trajectory isn't sustainable forever, it's not an immediate crisis either—more of an issue that will need to be addressed over time.If you're wondering how these macroeconomic trends impact your personal financial planning, feel free to reach out. Visit Birch Run Financial, email info@birchrunfinancial.com, or call 484-395-2190. You can always email Alex and Ed at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://www.birchrunfinancial.com/Alex and Ed's Book: Mastering The Money Mind: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal/dp/1544530536 Any opinions are those of Ed Lambert Alex Cabot, and Jon Gay and not necessarily those of RJFS or Raymond James. The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. There is no assurance any of the trends mentioned will continue or forecasts will occur. The information has been obtained from sources considered to be reliable, but Raymond James does not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. The examples throughout this material are for illustrative purposes only. Raymond James does not provide tax or legal services. Please discuss these matters with the appropriate professional. Diversification and asset allocation do not ensure a profit or protect against a loss. Past performance is not indicative of future returns. CDs are insured by the FDIC and offer a fixed rate of return, whereas the return and principal value of investment securities fluctuate with changes in market conditions. The S&P 500 is an unmanaged index of 500 widely held stocks that is generally considered representative of the U.S. Stock Market. Keep in mind that individuals cannot invest directly in any index, and index performance does not include transaction costs or other fees, which will affect actual investment performance. Individual investor's results will vary. This information is not intended as a solicitation or an offer to buy or sell any security referred to herein. Future investment performance cannot be guaranteed, investment yields will fluctuate with market conditions. International investing involves special risks, including currency fluctuations, differing financial accounting standards, and possible political and economic volatility. There is an inverse relationship between interest rate movements and bond prices. Generally, when interest rates rise, bond prices fall and when interest rates fall, bond prices generally rise. Investing in small cap stocks generally involves greater risks, and therefore, may not be appropriate for every investor. The prices of small company stocks may be subject to more volatility than those of large company stocks. Securities offered through Raymond James Financial Services, Inc. Member FINRA/SIPC. Investment advisory services offered through Raymond James Financial Services Advisors, Inc. Birch Run Financial is not a registered broker/dealer and is independent of Raymond James Financial Services. Birch Run Financial is located at 595 E Swedesford Rd, Ste 360, Wayne PA 19087 and can be reached at 484-395-2190. Any rating is not intended to be an endorsement, or any way indicative of the advisors' abilities to provide investment advice or management. This podcast is intended for informational purposes only.Links are being provided for information purposes only. Raymond James is not affiliated with and does not endorse, authorize, or sponsor any of the listed websites or their respective sponsors.Raymond James is not responsible for the content of any website or the collection or use of information regarding any website's users or members.

In this episode of Nurturing Financial Freedom, we kick off 2025 by discussing the economic highlights of 2024 and what lies ahead for the U.S. economy and markets. Ed provides an economic overview, while Alex dives into financial market performance and predictions.2024 saw significant progress in inflation reduction, with CPI falling from its 2022 peak of 9.1% to 2.8% by late 2024. While the Fed's soft landing approach avoided recession and brought inflation closer to its 2% target, uncertainties like potential tariffs remain. GDP growth for 2024 ended on a strong note at 2.7%, and economists project continued growth in 2025, with estimates ranging from 2.1% to 2.4%. The labor market, though slightly looser than in previous years, remains robust, with unemployment at 4.1%, still below historical averages.Interest rates, which peaked at 5.25% in mid-2023, were reduced incrementally to 4.25% by the end of 2024. While the Fed is not expected to cut rates further in early 2025, analysts predict additional rate reductions later this year, potentially lowering rates to around 3.25% by year-end.Turning to the markets, 2024 was a stellar year for U.S. equities, driven largely by the “Magnificent Seven” tech giants. The S&P 500 delivered an impressive 25% return, although most of this growth came from a small number of dominant stocks. In contrast, value stocks underperformed, returning 12.3%, while international stocks lagged with a modest 4.4% return. Other asset classes, including small and mid-cap stocks, bonds, and real estate, showed moderate gains. Gold, interestingly, mirrored the stock market's strong performance, rising by 25.5%.Looking ahead to 2025, major banks predict modest market growth, with the S&P 500 expected to yield returns of approximately 10%-12%. But despite a number of predictions - they are just that: predictions.  And Alex shares what he and the team think about these predictions. They are speculative, and market behavior is inherently unpredictable. The key takeaway is to remain diversified, stick to a long-term financial plan, and avoid reactionary decisions based on short-term market volatility.As always, staying prepared for market uncertainty while maintaining a balanced, goals-based strategy is critical for long-term success. You can always email Alex and Ed at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://www.birchrunfinancial.com/Alex and Ed's Book: Mastering The Money Mind: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal/dp/1544530536 Any opinions are those of Ed Lambert Alex Cabot, and Jon Gay and not necessarily those of RJFS or Raymond James. The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. There is no assurance any of the trends mentioned will continue or forecasts will occur. The information has been obtained from sources considered to be reliable, but Raymond James does not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. The examples throughout this material are for illustrative purposes only. Raymond James does not provide tax or legal services. Please discuss these matters with the appropriate professional. Diversification and asset allocation do not ensure a profit or protect against a loss. Past performance is not indicative of future returns. CDs are insured by the FDIC and offer a fixed rate of return, whereas the return and principal value of investment securities fluctuate with changes in market conditions. The S&P 500 is an unmanaged index of 500 widely held stocks that is generally considered representative of the U.S. Stock Market. Keep in mind that individuals cannot invest directly in any index, and index performance does not include transaction costs or other fees, which will affect actual investment performance. Individual investor's results will vary. This information is not intended as a solicitation or an offer to buy or sell any security referred to herein. Future investment performance cannot be guaranteed, investment yields will fluctuate with market conditions. International investing involves special risks, including currency fluctuations, differing financial accounting standards, and possible political and economic volatility. There is an inverse relationship between interest rate movements and bond prices. Generally, when interest rates rise, bond prices fall and when interest rates fall, bond prices generally rise. Investing in small cap stocks generally involves greater risks, and therefore, may not be appropriate for every investor. The prices of small company stocks may be subject to more volatility than those of large company stocks. Securities offered through Raymond James Financial Services, Inc. Member FINRA/SIPC. Investment advisory services offered through Raymond James Financial Services Advisors, Inc. Birch Run Financial is not a registered broker/dealer and is independent of Raymond James Financial Services. Birch Run Financial is located at 595 E Swedesford Rd, Ste 360, Wayne PA 19087 and can be reached at 484-395-2190. Any rating is not intended to be an endorsement, or any way indicative of the advisors' abilities to provide investment advice or management. This podcast is intended for informational purposes only.Links are being provided for information purposes only. Raymond James is not affiliated with and does not endorse, authorize, or sponsor any of the listed websites or their respective sponsors.Raymond James is not responsible for the content of any website or the collection or use of information regarding any website's users or members.

In this episode of Nurturing Financial Freedom, we delve into the timely topic of tariffs, their economic implications, and their resurgence in U.S. policy under President Trump's leadership. Alex Cabot and Ed Lambert of Birch Run Financial provide a clear breakdown of what tariffs are, who pays them, and their pros and cons.We begin by defining tariffs as taxes imposed on imported or exported goods. Alex clarifies a common misconception: while tariffs aim to promote domestic industries by making imported goods more expensive, it is the U.S. importer—not foreign governments or exporters—who pays these taxes. Importers often pass these costs on to consumers, leading to higher prices, though in some cases, businesses absorb the costs, reducing their margins.Tariffs have several objectives. They protect domestic industries by encouraging consumers to buy locally, generate government revenue, address trade imbalances, and promote national security. They can also support emerging industries and serve as negotiating tools in trade disputes. For instance, the current administration appears to be using tariffs as leverage in international trade negotiations, particularly with Mexico and China.Ed expands on the downsides of tariffs, including their potential to trigger trade wars, where reciprocal tariffs harm businesses and consumers on both sides. Tariffs can also disrupt global supply chains, drive inflation, and reduce economic efficiency. For example, industries reliant on imported materials may face squeezed profit margins or pass costs onto consumers, further exacerbating financial strain. Additionally, widespread tariffs can slow global economic growth by undermining the interconnectedness of modern economies.The discussion concludes with a balanced perspective. While tariffs can be a useful tool to protect strategic industries or as a negotiation tactic, blanket tariffs across all trading partners are generally counterproductive. Thoughtful implementation is critical to avoid unintended consequences.Alex and Ed emphasize their commitment to breaking down complex topics for listeners, encouraging questions, and offering consultations. For more insights, they invite listeners to connect via their website, email, or social media. You can always email Alex and Ed at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://www.birchrunfinancial.com/Alex and Ed's Book: Mastering The Money Mind: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal/dp/1544530536 Any opinions are those of Ed Lambert Alex Cabot, and Jon Gay and not necessarily those of RJFS or Raymond James. The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. There is no assurance any of the trends mentioned will continue or forecasts will occur. The information has been obtained from sources considered to be reliable, but Raymond James does not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. The examples throughout this material are for illustrative purposes only. Raymond James does not provide tax or legal services. Please discuss these matters with the appropriate professional. Diversification and asset allocation do not ensure a profit or protect against a loss. Past performance is not indicative of future returns. CDs are insured by the FDIC and offer a fixed rate of return, whereas the return and principal value of investment securities fluctuate with changes in market conditions. The S&P 500 is an unmanaged index of 500 widely held stocks that is generally considered representative of the U.S. Stock Market. Keep in mind that individuals cannot invest directly in any index, and index performance does not include transaction costs or other fees, which will affect actual investment performance. Individual investor's results will vary. This information is not intended as a solicitation or an offer to buy or sell any security referred to herein. Future investment performance cannot be guaranteed, investment yields will fluctuate with market conditions. International investing involves special risks, including currency fluctuations, differing financial accounting standards, and possible political and economic volatility. There is an inverse relationship between interest rate movements and bond prices. Generally, when interest rates rise, bond prices fall and when interest rates fall, bond prices generally rise. Investing in small cap stocks generally involves greater risks, and therefore, may not be appropriate for every investor. The prices of small company stocks may be subject to more volatility than those of large company stocks. Securities offered through Raymond James Financial Services, Inc. Member FINRA/SIPC. Investment advisory services offered through Raymond James Financial Services Advisors, Inc. Birch Run Financial is not a registered broker/dealer and is independent of Raymond James Financial Services. Birch Run Financial is located at 595 E Swedesford Rd, Ste 360, Wayne PA 19087 and can be reached at 484-395-2190. Any rating is not intended to be an endorsement, or any way indicative of the advisors' abilities to provide investment advice or management. This podcast is intended for informational purposes only.Links are being provided for information purposes only. Raymond James is not affiliated with and does not endorse, authorize, or sponsor any of the listed websites or their respective sponsors.Raymond James is not responsible for the content of any website or the collection or use of information regarding any website's users or members.

In this episode of Nurturing Financial Freedom, we discuss how the markets responded to the certainty brought by the recent Presidential election and what history suggests about post-election market performance. While maintaining a nonpartisan lens, we explore the relationship between political outcomes and financial markets.Ed starts by analyzing market movements in the week following the election. He highlights that the clear election outcome brought a sense of relief and stability to the markets, avoiding the prolonged uncertainty seen in prior cycles. This certainty spurred optimism, particularly around potential corporate tax extensions and reduced regulation, both of which are expected to support corporate profits. Financial stocks and small-cap U.S. stocks were notable outperformers, buoyed by deregulation hopes and domestic market focus, respectively. However, bonds and international stocks underperformed due to rising bond yields and a strengthening U.S. dollar, which hurt returns on foreign investments.Alex then shifts the focus to historical trends, emphasizing that while markets typically perform well post-election, this is consistent with broader market behavior rather than directly attributable to election outcomes. He notes that since 1980, nine of 11 post-election years saw positive market returns, averaging 15.6%, higher than the overall market average. Yet, these gains often stem from broader economic conditions rather than the Presidency itself- correlation does not mean causation!He reminds us that the stock market, like a nimble speedboat, can react quickly to news, whereas the economy, more akin to a massive aircraft carrier, changes direction only with significant events. Regardless of political shifts, long-term economic fundamentals and corporate earnings drive market performance. Again, reactionary changes to investment strategies based solely on political outcomes are unwise.The discussion closes with a look ahead, noting that volatility can increase under a new administration but isn't guaranteed. Historical examples, such as the quiet markets of 2017 following Trump's first inauguration, illustrate the unpredictable nature of post-election market behavior.Throughout, we stress the importance of focusing on long-term investment strategies rather than short-term political or market fluctuations. For personalized guidance, Birch Run Financial invites listeners to reach out through their website or social media channels. You can always email Alex and Ed at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://www.birchrunfinancial.com/Alex and Ed's Book: Mastering The Money Mind: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal/dp/1544530536 Any opinions are those of Ed Lambert and Alex Cabot and not necessarily those of RJFS or Raymond James. The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. There is no assurance any of the trends mentioned will continue or forecasts will occur. The information has been obtained from sources considered to be reliable, but Raymond James does not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. The examples throughout this material are for illustrative purposes only. Raymond James does not provide tax or legal services. Please discuss these matters with the appropriate professional. Diversification and asset allocation do not ensure a profit or protect against a loss. Past performance is not indicative of future returns. CDs are insured by the FDIC and offer a fixed rate of return, whereas the return and principal value of investment securities fluctuate with changes in market conditions. The S&P 500 is an unmanaged index of 500 widely held stocks that is generally considered representative of the U.S. Stock Market. Keep in mind that individuals cannot invest directly in any index, and index performance does not include transaction costs or other fees, which will affect actual investment performance. Individual investor's results will vary. This information is not intended as a solicitation or an offer to buy or sell any security referred to herein. Future investment performance cannot be guaranteed, investment yields will fluctuate with market conditions. International investing involves special risks, including currency fluctuations, differing financial accounting standards, and possible political and economic volatility. There is an inverse relationship between interest rate movements and bond prices. Generally, when interest rates rise, bond prices fall and when interest rates fall, bond prices generally rise. Investing in small cap stocks generally involves greater risks, and therefore, may not be appropriate for every investor. The prices of small company stocks may be subject to more volatility than those of large company stocks. Securities offered through Raymond James Financial Services, Inc. Member FINRA/SIPC. Investment advisory services offered through Raymond James Financial Services Advisors, Inc. Birch Run Financial is not a registered broker/dealer and is independent of Raymond James Financial Services. Birch Run Financial is located at 595 E Swedesford Rd, Ste 360, Wayne PA 19087 and can be reached at 484-395-2190. Any rating is not intended to be an endorsement, or any way indicative of the advisors' abilities to provide investment advice or management. This podcast is intended for informational purposes only.Links are being provided for information purposes only. Raymond James is not affiliated with and does not endorse, authorize, or sponsor any of the listed websites or their respective sponsors.Raymond James is not responsible for the content of any website or the collection or use of information regarding any website's users or members.

Today, Alex Cabot and Ed Lambert from Birch Run Financial dive into the intersection of politics and financial markets, focusing on the upcoming election. We discuss widespread market myths and offer a data-driven approach to navigating political cycles as an investor.Alex begins by addressing common misconceptions about election years and market volatility. Despite popular belief, election years do not inherently cause heightened volatility. Examining the past nine presidential elections, Alex highlights that only three were more volatile than average—2000, 2008, and 2020—events driven not by elections, but by major economic crises such as the tech bubble burst, the financial crisis, and the COVID-19 pandemic.Another misconception Alex tackles is the belief that markets perform better under Republican administrations due to their perceived pro-business stance. Historical data shows that markets have actually done well under both Democratic and Republican presidencies. Staying invested throughout all political cycles, regardless of the party in power, yields better long-term results, as markets ultimately respond more to economic fundamentals than to political leadership.Ed wraps up the discussion with an optimistic outlook on the U.S. economy. He emphasizes that, no matter the election outcome, the U.S. will continue to be the world's dominant economic power. Key statistics reinforce this point: the U.S. GDP is currently 55% larger than China's, and the country leads in energy production and technological innovation. He also points to the U.S.'s demographic advantages, including high immigration rates, which help sustain economic growth compared to other developed nations with aging populations.The episode underscores the importance of remaining calm and focused on long-term financial goals, no matter the election results. The U.S. economy is resilient, and sound investment strategies should not be swayed by political fearmongering or short-term volatility. You can always email Alex and Ed at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://www.birchrunfinancial.com/Alex and Ed's Book: Mastering The Money Mind: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal/dp/1544530536 Any opinions are those of Ed Lambert and Alex Cabot and not necessarily those of RJFS or Raymond James. The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. There is no assurance any of the trends mentioned will continue or forecasts will occur. The information has been obtained from sources considered to be reliable, but Raymond James does not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. The examples throughout this material are for illustrative purposes only. Raymond James does not provide tax or legal services. Please discuss these matters with the appropriate professional. Diversification and asset allocation do not ensure a profit or protect against a loss. Past performance is not indicative of future returns. CDs are insured by the FDIC and offer a fixed rate of return, whereas the return and principal value of investment securities fluctuate with changes in market conditions. The S&P 500 is an unmanaged index of 500 widely held stocks that is generally considered representative of the U.S. Stock Market. Keep in mind that individuals cannot invest directly in any index, and index performance does not include transaction costs or other fees, which will affect actual investment performance. Individual investor's results will vary. This information is not intended as a solicitation or an offer to buy or sell any security referred to herein. Future investment performance cannot be guaranteed, investment yields will fluctuate with market conditions. International investing involves special risks, including currency fluctuations, differing financial accounting standards, and possible political and economic volatility. There is an inverse relationship between interest rate movements and bond prices. Generally, when interest rates rise, bond prices fall and when interest rates fall, bond prices generally rise. Investing in small cap stocks generally involves greater risks, and therefore, may not be appropriate for every investor. The prices of small company stocks may be subject to more volatility than those of large company stocks. Securities offered through Raymond James Financial Services, Inc. Member FINRA/SIPC. Investment advisory services offered through Raymond James Financial Services Advisors, Inc. Birch Run Financial is not a registered broker/dealer and is independent of Raymond James Financial Services. Birch Run Financial is located at 595 E Swedesford Rd, Ste 360, Wayne PA 19087 and can be reached at 484-395-2190. Any rating is not intended to be an endorsement, or any way indicative of the advisors' abilities to provide investment advice or management. This podcast is intended for informational purposes only.Links are being provided for information purposes only. Raymond James is not affiliated with and does not endorse, authorize, or sponsor any of the listed websites or their respective sponsors.Raymond James is not responsible for the content of any website or the collection or use of information regarding any website's users or members.

In this episode, we discuss the recent Federal Reserve rate cut and its implications for the market and economy. The Fed reduced its overnight lending rate by half a percentage point, bringing it down from 5.25% to 4.75%. This was the first rate cut since March 2020, signaling a potential shift in monetary policy. The Fed's dual mandate—maintaining price stability and maximizing employment—guides its decisions. With inflation largely under control, the Fed is now able to focus on adjusting rates to support employment without risking economic stability.Ed explains that the current rate reduction is a strategic move, allowing the Fed flexibility to respond to future economic challenges. With rates still relatively high, the Fed has room to cut further if needed, but prefers a gradual approach to avoid destabilizing progress against inflation. He mentions the possibility of additional cuts later this year, barring any sudden spikes in inflation.Alex highlights how the market has reacted to the Fed's actions, noting that price-to-earnings ratios and bond yields adjusted even before the official rate cut. This preemptive adjustment is common as markets tend to "price in" expected policy changes. However, he cautions that predicting future interest rates accurately is challenging, and the Fed's projections often diverge from reality.We also explore the potential impact of these rate changes on the housing market. Higher interest rates have made borrowing more expensive, which affects home affordability. Many homeowners who refinanced at low rates may be reluctant to sell and take on a new mortgage at higher rates, constraining housing supply. Despite these challenges, Alex advises that personal financial decisions, such as purchasing a home, should be based on individual circumstances rather than solely on market conditions.Overall, the episode emphasizes the importance of having a personalized, all-weather investment strategy that can withstand various economic scenarios. Rather than making reactive changes based on market fluctuations, maintaining a consistent and well-thought-out plan tailored to individual goals and risk tolerance is crucial. You can always email Alex and Ed at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://www.birchrunfinancial.com/Alex and Ed's Book: Mastering The Money Mind: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal/dp/1544530536 Any opinions are those of Ed Lambert and Alex Cabot and not necessarily those of RJFS or Raymond James. The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. There is no assurance any of the trends mentioned will continue or forecasts will occur. The information has been obtained from sources considered to be reliable, but Raymond James does not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. The examples throughout this material are for illustrative purposes only. Raymond James does not provide tax or legal services. Please discuss these matters with the appropriate professional. Diversification and asset allocation do not ensure a profit or protect against a loss. Past performance is not indicative of future returns. CDs are insured by the FDIC and offer a fixed rate of return, whereas the return and principal value of investment securities fluctuate with changes in market conditions. The S&P 500 is an unmanaged index of 500 widely held stocks that is generally considered representative of the U.S. Stock Market. Keep in mind that individuals cannot invest directly in any index, and index performance does not include transaction costs or other fees, which will affect actual investment performance. Individual investor's results will vary. This information is not intended as a solicitation or an offer to buy or sell any security referred to herein. Future investment performance cannot be guaranteed, investment yields will fluctuate with market conditions. International investing involves special risks, including currency fluctuations, differing financial accounting standards, and possible political and economic volatility. There is an inverse relationship between interest rate movements and bond prices. Generally, when interest rates rise, bond prices fall and when interest rates fall, bond prices generally rise. Investing in small cap stocks generally involves greater risks, and therefore, may not be appropriate for every investor. The prices of small company stocks may be subject to more volatility than those of large company stocks. Securities offered through Raymond James Financial Services, Inc. Member FINRA/SIPC. Investment advisory services offered through Raymond James Financial Services Advisors, Inc. Birch Run Financial is not a registered broker/dealer and is independent of Raymond James Financial Services. Birch Run Financial is located at 595 E Swedesford Rd, Ste 360, Wayne PA 19087 and can be reached at 484-395-2190. Any rating is not intended to be an endorsement, or any way indicative of the advisors' abilities to provide investment advice or management. This podcast is intended for informational purposes only.Links are being provided for information purposes only. Raymond James is not affiliated with and does not endorse, authorize, or sponsor any of the listed websites or their respective sponsors.Raymond James is not responsible for the content of any website or the collection or use of information regarding any website's users or members.

In this episode of "Nurturing Financial Freedom," we discuss the surprising market volatility that occurred in early August 2024 and explore what investors should take away from these events. But first, we actually met in person last month - for the first time after working together for over five years!The market's volatility in August was triggered primarily by two factors: weaker-than-expected economic reports and high market valuations. The Institute for Supply Management's report on business indicated declining confidence in the manufacturing sector, which, alongside a disappointing non-farm payroll report, caused investors to worry that the economy might be slowing too quickly in its fight against inflation. This led to a significant market pullback, particularly in the Dow Jones Industrial Average, which dropped 2,000 points over a few days.  But even in the time between writing this episode and recording it, market volatility has calmed.Alex and Ed emphasize that while these reports sparked concern, the broader economic context remains positive. They remind listeners that market fluctuations are normal, and short-term downturns don't necessarily signal long-term issues. The key takeaway is the importance of maintaining a balanced and diversified portfolio to withstand such volatility. They also highlight the Federal Reserve's potential role in stabilizing the economy, noting that if a significant slowdown occurs, the Fed has the ability to cut interest rates to stimulate growth.  It's possible we see this after their next meeting in September.Predicting short-term market movements is extremely difficult, akin to forecasting the weather. Instead, the focus should be on long-term strategies and maintaining perspective during turbulent times. Ed advises against panicking during market volatility, stressing the importance of staying the course with a well-diversified investment plan. You can always email Alex and Ed at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://www.birchrunfinancial.com/Alex and Ed's Book: Mastering The Money Mind: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal/dp/1544530536 Any opinions are those of Ed Lambert and Alex Cabot and not necessarily those of RJFS or Raymond James. The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. There is no assurance any of the trends mentioned will continue or forecasts will occur. The information has been obtained from sources considered to be reliable, but Raymond James does not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. The examples throughout this material are for illustrative purposes only. Raymond James does not provide tax or legal services. Please discuss these matters with the appropriate professional. Diversification and asset allocation do not ensure a profit or protect against a loss. Past performance is not indicative of future returns. CDs are insured by the FDIC and offer a fixed rate of return, whereas the return and principal value of investment securities fluctuate with changes in market conditions. The S&P 500 is an unmanaged index of 500 widely held stocks that is generally considered representative of the U.S. Stock Market. Keep in mind that individuals cannot invest directly in any index, and index performance does not include transaction costs or other fees, which will affect actual investment performance. Individual investor's results will vary. This information is not intended as a solicitation or an offer to buy or sell any security referred to herein. Future investment performance cannot be guaranteed, investment yields will fluctuate with market conditions. International investing involves special risks, including currency fluctuations, differing financial accounting standards, and possible political and economic volatility. There is an inverse relationship between interest rate movements and bond prices. Generally, when interest rates rise, bond prices fall and when interest rates fall, bond prices generally rise. Investing in small cap stocks generally involves greater risks, and therefore, may not be appropriate for every investor. The prices of small company stocks may be subject to more volatility than those of large company stocks. Securities offered through Raymond James Financial Services, Inc. Member FINRA/SIPC. Investment advisory services offered through Raymond James Financial Services Advisors, Inc. Birch Run Financial is not a registered broker/dealer and is independent of Raymond James Financial Services. Birch Run Financial is located at 595 E Swedesford Rd, Ste 360, Wayne PA 19087 and can be reached at 484-395-2190. Any rating is not intended to be an endorsement, or any way indicative of the advisors' abilities to provide investment advice or management. This podcast is intended for informational purposes only.Links are being provided for information purposes only. Raymond James is not affiliated with and does not endorse, authorize, or sponsor any of the listed websites or their respective sponsors.Raymond James is not responsible for the content of any website or the collection or use of information regarding any website's users or members.

This month, Alex Cabot and Ed Lambert of Birch Run Financial discuss the financial landscape of the first half of 2024. They delve into how economic conditions and market performance have evolved, noting that the year hasn't gone as initially expected, yet has yielded positive results overall.Ed begins by providing an overview of the year's economic and market developments. At the start of 2024, there was significant optimism due to a strong stock market rally in late 2023, driven by improving inflation data. This optimism led many to anticipate multiple interest rate cuts by the Federal Reserve. However, inflation progress stalled in the first quarter of 2024, delaying the anticipated rate cuts. Despite this, the market performed well, with the S&P 500 rising by roughly 15% in the first half of the year. Ed attributes this to resumed inflation progress, stable economic growth, and the strong performance of leading AI companies.Alex then provides a more detailed breakdown of asset class performances (info courtesy of YCharts). He highlights the disparity between growth and value stocks within the S&P 500, with growth stocks significantly outperforming value stocks. Notably, the top seven stocks in the S&P 500, primarily tech giants like Nvidia, Microsoft, and Apple, saw dramatic gains, significantly driving overall market performance. Mid-cap stocks returned 6.2%, while small-cap stocks slightly declined. International markets showed moderate gains, and bond markets saw slight declines due to the lack of expected rate cuts.The conversation shifts to the importance of diversification. Alex emphasizes that while concentrated investments in a few top-performing stocks can yield high returns, this strategy carries significant risks. He underscores the value of a diversified portfolio, which spreads risk across various sectors and asset classes, reducing the potential for substantial losses. Diversification, he explains, is designed to provide stability and steady growth over the long term, rather than capitalizing on short-term market trends.The hosts also touch on the emotional aspects of investing, discussing how fear and greed can drive poor financial decisions. They stress the importance of working with financial professionals who can offer objective, rational advice, helping investors navigate market fluctuations without succumbing to emotional impulses.Overall, the first half of 2024 has reinforced the value of diversification and the importance of maintaining a balanced investment strategy. Despite unexpected developments, a well-diversified portfolio has proven resilient and capable of delivering positive returns.Gold is subject to the special risks associated with investing in precious metals, including but not limited to: price may be subject to wide fluctuation; the market is relatively limited; the sources are concentrated in countries that have the potential for instability; and the market is unregulated. Bond prices and yields are subject to change based upon market conditions and availability. International investing involves special risks, including currency fluctuations, differing financial accounting standards, and possible political and economic volatility. You can always email Alex and Ed at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://www.birchrunfinancial.com/Alex and Ed's Book: Mastering The Money Mind: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal/dp/1544530536 Any opinions are those of Ed Lambert and Alex Cabot and not necessarily those of RJFS or Raymond James. The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. There is no assurance any of the trends mentioned will continue or forecasts will occur. The information has been obtained from sources considered to be reliable, but Raymond James does not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. The examples throughout this material are for illustrative purposes only. Raymond James does not provide tax or legal services. Please discuss these matters with the appropriate professional. Diversification and asset allocation do not ensure a profit or protect against a loss. Past performance is not indicative of future returns. CDs are insured by the FDIC and offer a fixed rate of return, whereas the return and principal value of investment securities fluctuate with changes in market conditions. The S&P 500 is an unmanaged index of 500 widely held stocks that is generally considered representative of the U.S. Stock Market. Keep in mind that individuals cannot invest directly in any index, and index performance does not include transaction costs or other fees, which will affect actual investment performance. Individual investor's results will vary. This information is not intended as a solicitation or an offer to buy or sell any security referred to herein. Future investment performance cannot be guaranteed, investment yields will fluctuate with market conditions. International investing involves special risks, including currency fluctuations, differing financial accounting standards, and possible political and economic volatility. There is an inverse relationship between interest rate movements and bond prices. Generally, when interest rates rise, bond prices fall and when interest rates fall, bond prices generally rise. Investing in small cap stocks generally involves greater risks, and therefore, may not be appropriate for every investor. The prices of small company stocks may be subject to more volatility than those of large company stocks. Securities offered through Raymond James Financial Services, Inc. Member FINRA/SIPC. Investment advisory services offered through Raymond James Financial Services Advisors, Inc. Birch Run Financial is not a registered broker/dealer and is independent of Raymond James Financial Services. Birch Run Financial is located at 595 E Swedesford Rd, Ste 360, Wayne PA 19087 and can be reached at 484-395-2190. Any rating is not intended to be an endorsement, or any way indicative of the advisors abilities to provide investment advice or management. This podcast is intended for informational purposes only.Links are being provided for information purposes only. Raymond James is not affiliated with and does not endorse, authorize, or sponsor any of the listed websites or their respective sponsors.Raymond James is not responsible for the content of any website or the collection or use of information regarding any website's users or members.

In this episode of "Nurturing Financial Freedom," we discuss the crucial topic of the dangers of putting too much money into a single investment, often referred to as concentration risk.Alex starts by explaining that concentration risk, while not unique to any one type of investment, is particularly prevalent in stocks. He dispels the common "eggs in one basket" analogy by emphasizing that diversification means more than just spreading investments across similar types. True diversification involves spreading investments across different asset classes to reduce risk.Alex outlines two main problems with overconcentration. First, the actual investment result can be highly unpredictable. While betting heavily on a successful company like Google or Amazon at the right time could have been life-changing, many other seemingly promising stocks like Pets.com or Copper Mountain did not deliver. The second problem is the moral hazard that success can create. If an investor gets lucky once, they might believe they are smarter than the market, leading to risky behavior that can eventually result in significant losses.Jag draws a parallel with gambling, noting that while investing done right has a positive long-term expectation, gambling generally does not. Alex agrees, stressing that concentrating money in a single security is akin to gambling and should be avoided.Ed then discusses two types of overconcentration: voluntary and automatic. Voluntary overconcentration happens when investors intentionally buy large amounts of a single stock, often due to recent performance. Automatic overconcentration occurs when employees accumulate large amounts of their employer's stock through compensation packages. He explains the psychological factors at play, including recency bias, where people expect recent trends to continue indefinitely, and loyalty to their company, which can cloud judgment.Ed also highlights the practical issues, such as tax liabilities and the emotional difficulty of selling high-performing stocks. He shares a cautionary tale of a pharmaceutical company whose stock plummeted due to unforeseen issues, causing employees to lose significant portions of their net worth and even their jobs. This example underscores the importance of not being overly reliant on any single company, especially one's employer.To mitigate these risks, Alex advises that no more than 5% of a portfolio should be invested in a single security, with a cautious approach to anything between 5% and 10%. Exceeding this 10% can make financial planning difficult, as the range of potential outcomes becomes too broad and unpredictable.Jag and Ed conclude by reinforcing the importance of a diversified portfolio for long-term financial success. They stress that while high-risk bets can occasionally pay off, the potential for catastrophic losses makes them unsuitable for most investors. Instead, maintaining a balanced and diversified investment strategy helps ensure financial stability and success. You can always email Alex and Ed at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://www.birchrunfinancial.com/Alex and Ed's Book: Mastering The Money Mind: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal/dp/1544530536 Any opinions are those of Ed Lambert and Alex Cabot and not necessarily those of RJFS or Raymond James. The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. There is no assurance any of the trends mentioned will continue or forecasts will occur. The information has been obtained from sources considered to be reliable, but Raymond James does not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. The examples throughout this material are for illustrative purposes only. Raymond James does not provide tax or legal services. Please discuss these matters with the appropriate professional. Diversification and asset allocation do not ensure a profit or protect against a loss. Past performance is not indicative of future returns. CDs are insured by the FDIC and offer a fixed rate of return, whereas the return and principal value of investment securities fluctuate with changes in market conditions. Securities offered through Raymond James Financial Services, Inc. Member FINRA/SIPC. Investment advisory services offered through Raymond James Financial Services Advisors, Inc. Birch Run Financial is not a registered broker/dealer and is independent of Raymond James Financial Services. Birch Run Financial is located at 595 E Swedesford Rd, Ste 360, Wayne PA 19087 and can be reached at 484-395-2190. Any rating is not intended to be an endorsement, or any way indicative of the advisors abilities to provide investment advice or management. This podcast is intended for informational purposes only.

In this episode of the Nurturing Financial Freedom podcast, we explore a topic that often gets lost amidst daily media noise: the long-term optimism about the future of the United States. We delve into why, despite current challenges, there's a compelling case for optimism.Ed Lambert kicks off the discussion by highlighting the quality of life in the U.S. in 2024.  Americans enjoy a standard of living unparalleled in human history. While acknowledging the country's challenges, Ed emphasizes the transformative impact of technology and innovation. Today's ubiquitous cell phones, powerful computers, and AI advancements exemplify this progress. These technologies, Ed argues, have dramatically increased productivity and will continue to do so, ensuring economic growth even as the labor force growth slows.Ed also addresses concerns about AI displacing jobs. He believes that while AI will disrupt certain sectors, it will also create new opportunities, much like the automobile did a century ago. People will adapt by transitioning to roles that leverage AI as a tool, enhancing productivity and economic efficiency.The discussion then shifts to the U.S.'s unique position in the global economy. Ed notes that declining birth rates and aging populations are global phenomena, but the U.S. remains an attractive destination for immigrants seeking better lives. This influx of talent fuels innovation and entrepreneurship, sustaining economic growth. Unlike its primary adversaries, China and Russia, the U.S. benefits from a favorable economic structure and remains a magnet for global talent and investment.Alex Cabot supports this optimistic outlook with data. He compares the U.S. economy today with past decades, showing significant growth in GDP and per capita income, even when adjusted for inflation. Alex paints a stark contrast between the living standards in 1955 and today, demonstrating massive improvements in housing, income, education, and life expectancy.He also broadens the perspective to a global scale, noting that extreme poverty has dramatically decreased worldwide. A century ago, 80% of the global population lived in extreme poverty; today, it's less than 10%. This decline is a testament to the positive impact of technological and economic advancements on humanity as a whole.In concluding, Alex argues that long-term optimism is crucial for financial planning. While media often highlights uncertainties and negative events, focusing on the broader, long-term trends reveals a trajectory of continuous improvement. And he uses Jag's favorite weather analogy.This episode reinforces the importance of maintaining a positive outlook on the future, grounded in data and historical context. The U.S., with its robust economy and culture of innovation, is well-positioned to continue thriving in the decades to come. You can always email Alex and Ed at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://www.birchrunfinancial.com/Alex and Ed's Book: Mastering The Money Mind: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal/dp/1544530536 Any opinions are those of Ed Lambert and Alex Cabot and not necessarily those of RJFS or Raymond James. The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. There is no assurance any of the trends mentioned will continue or forecasts will occur. The information has been obtained from sources considered to be reliable, but Raymond James does not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. The examples throughout this material are for illustrative purposes only. Raymond James does not provide tax or legal services. Please discuss these matters with the appropriate professional. Diversification and asset allocation do not ensure a profit or protect against a loss. Past performance is not indicative of future returns. CDs are insured by the FDIC and offer a fixed rate of return, whereas the return and principal value of investment securities fluctuate with changes in market conditions. Securities offered through Raymond James Financial Services, Inc. Member FINRA/SIPC. Investment advisory services offered through Raymond James Financial Services Advisors, Inc. Birch Run Financial is not a registered broker/dealer and is independent of Raymond James Financial Services. Birch Run Financial is located at 595 E Swedesford Rd, Ste 360, Wayne PA 19087 and can be reached at 484-395-2190. Any rating is not intended to be an endorsement, or any way indicative of the advisors abilities to provide investment advice or management. This podcast is intended for informational purposes only.

Today, we pivot from previous discussions on bull markets to delve into the topic of inflation, especially given the recent slowing of progress according to CPI data. Ed kicks off the discussion by highlighting that although we desire a linear decrease in inflation to the FED's 2% target, achieving this without economic recession is challenging. He points out the current robust state of the U.S. economy, with low unemployment at 3.8% and a significant GDP growth of 3.4% in the last quarter of 2023. Despite this, the struggle for median wage earners against inflation is real, accentuated by higher credit card interest rates and limited savings.Ed elaborates that the current economic conditions, including strong job markets and investment returns, inherently slow down the fight against inflation. He argues that while this scenario isn't ideal for every worker, it is preferable to the alternative—a recession marked by higher unemployment and reduced consumption, which would rapidly decrease inflation but at a greater cost.Alex then provides further analysis of recent economic data, emphasizing the variability within CPI's year-over-year report showing a moderated inflation rate at 4.1% for 2023. He discusses specific sectors like food and energy, highlighting significant disparities such as a decrease in energy costs and specific increases in costs of household goods. Alex reassures that despite prolonged higher interest rates, the market and economic outlook remains stable, supported by sustained job openings and steady real estate prices.Overall, our discussion underscores the complex interplay between economic growth, inflation, and the Federal Reserve's policies. We conclude that a slower reduction in inflation paired with economic stability is currently more beneficial than the drastic alternative of entering a recession.NEW: Birch Run Financial on YouTube: https://youtube.com/@birchrunfinancial You can always email Alex and Ed at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://www.birchrunfinancial.com/Alex and Ed's Book: Mastering The Money Mind: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal/dp/1544530536 Any opinions are those of Ed Lambert and Alex Cabot and not necessarily those of RJFS or Raymond James. The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. There is no assurance any of the trends mentioned will continue or forecasts will occur. The information has been obtained from sources considered to be reliable, but Raymond James does not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. The examples throughout this material are for illustrative purposes only. Raymond James does not provide tax or legal services. Please discuss these matters with the appropriate professional. Diversification and asset allocation do not ensure a profit or protect against a loss. Past performance is not indicative of future returns. CDs are insured by the FDIC and offer a fixed rate of return, whereas the return and principal value of investment securities fluctuate with changes in market conditions. Securities offered through Raymond James Financial Services, Inc. Member FINRA/SIPC. Investment advisory services offered through Raymond James Financial Services Advisors, Inc. Birch Run Financial is not a registered broker/dealer and is independent of Raymond James Financial Services. Birch Run Financial is located at 595 E Swedesford Rd, Ste 360, Wayne PA 19087 and can be reached at 484-395-2190. Any rating is not intended to be an endorsement, or any way indicative of the advisors abilities to provide investment advice or management. This podcast is intended for informational purposes only.

Today, we're discussing the current state of the market, which has seen impressive returns since last Halloween. The focus today is on the importance of maintaining discipline not just in downturns but also during strong market periods. Alex kicks off by highlighting the significant growth in the capital markets in 2023, following a challenging year. The S&P 500's substantial gains, especially in the last few months of 2023 and into this year, underscore the market's strong performance. This surge is attributed to decreasing inflation expectations and a boom in tech and AI sectors, lifting the broader market.Alex points out the necessity of rebalancing investment portfolios more frequently in such a bullish market to stick to original allocation targets. This is because different asset classes may not move in tandem, potentially skewing the portfolio away from its intended balance. However, he cautions against over-rebalancing, especially in taxable accounts, to avoid unintended tax liabilities, including the wash-sale rule. Rebalancing is about adhering to the original strategy, not changing it.Ed then shifts the conversation towards the psychological aspect of investing in such an environment. He stresses the importance of remaining cool-headed, noting that emotional investment decisions often lead to poor outcomes. Recognizing that all market runs eventually end, he advises investors to enjoy the growth but not become emotionally attached to it. Ed warns against the dangers of chasing performance and altering a well-diversified portfolio in pursuit of higher returns, using the late '90s tech bubble as a cautionary tale. He concludes by encouraging continued investment through dollar-cost averaging, highlighting the risks of trying to time the market and the potential to miss out on significant gains.In summary, our advice in this strong market is to appreciate the gains, continue rebalancing, and stick to your investment plan. It's crucial to prepare for all possible outcomes, recognizing that while the market's current trajectory is upward, it will inevitably shift at some point. You can always email Alex and Ed at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://www.birchrunfinancial.com/Alex and Ed's Book: Mastering The Money Mind: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal/dp/1544530536 Any opinions are those of Ed Lambert and Alex Cabot and not necessarily those of RJFS or Raymond James. The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. There is no assurance any of the trends mentioned will continue or forecasts will occur. The information has been obtained from sources considered to be reliable, but Raymond James does not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. The examples throughout this material are for illustrative purposes only. Raymond James does not provide tax or legal services. Please discuss these matters with the appropriate professional. Diversification and asset allocation do not ensure a profit or protect against a loss. Past performance is not indicative of future returns. CDs are insured by the FDIC and offer a fixed rate of return, whereas the return and principal value of investment securities fluctuate with changes in market conditions. Securities offered through Raymond James Financial Services, Inc. Member FINRA/SIPC. Investment advisory services offered through Raymond James Financial Services Advisors, Inc. Birch Run Financial is not a registered broker/dealer and is independent of Raymond James Financial Services. Birch Run Financial is located at 595 E Swedesford Rd, Ste 360, Wayne PA 19087 and can be reached at 484-395-2190. Any rating is not intended to be an endorsement, or any way indicative of the advisors abilities to provide investment advice or management. This podcast is intended for informational purposes only.

For most of us, we manage our investments with the goal of having a nice big nest egg when it's time to retire.  But we need to continue to stay invested throughout our retirement.  Often, investors are more afraid of running out of money than they are actually dying!  Today Alex Cabot and Ed Lambert of Birch Run Financial discuss how to lower that risk.Ed points out that psychologically, investors experience more anxiety around market changes right before and after retirement.  After all, the move from drawing income from a salary to drawing from investments is one of the biggest changes of your financial life.  If you retire at 65, your median life expectancy in retirement is 20 years.   And you have a 25% chance of living until age 90.  How do you make your money last? You need a growth component to your portfolio.  And while we plan for long-term market growth, we need to prepare for bumps in the road -things like the tech bubble bursting, the 2008 crisis, the "COVID Crash," and more.   Moreover, inflation is built into our economy by design.  We've seen a 2.4% core inflation rate over the last 20 years.  If you extrapolate that forward, $10,000/month in living expenses today will be $18,000 in 25 years, or $20,000 in 30 years!  You want to have enough income to live on, and in most cases, have something to pass down to your heirs.Alex speaks to the importance of diversification.  With the help of Morningstar, he looked at several different theoretical $1,000,000 portfolios over the last 25 years. Assuming a 2.4% rate of inflation, and a $40,000 annual distribution (adjusted for inflation), here's what he found. That million dollar portfolio, counting inflation and distributions, would be worth the following today, 25 years later.Stock only: $908kBond only: $360k60% stock 40% bond $1.3MT-bills: $0Alex breaks down these numbers, and explains why the diversified portfolio outperformed anything else on the list.Here's the article on diversification Alex referenced on his LinkedIn in today's episode: https://www.linkedin.com/pulse/measuring-impact-portfolio-distributions-diversified-asset-cabot/ You can always email Alex and Ed at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://www.birchrunfinancial.com/Alex and Ed's Book: Mastering The Money Mind: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal/dp/1544530536 Any opinions are those of Ed Lambert and Alex Cabot and not necessarily those of RJFS or Raymond James. The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. There is no assurance any of the trends mentioned will continue or forecasts will occur. The information has been obtained from sources considered to be reliable, but Raymond James does not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. The examples throughout this material are for illustrative purposes only. Raymond James does not provide tax or legal services. Please discuss these matters with the appropriate professional. Diversification and asset allocation do not ensure a profit or protect against a loss. Past performance is not indicative of future returns. CDs are insured by the FDIC and offer a fixed rate of return, whereas the return and principal value of investment securities fluctuate with changes in market conditions. Securities offered through Raymond James Financial Services, Inc. Member FINRA/SIPC. Investment advisory services offered through Raymond James Financial Services Advisors, Inc. Birch Run Financial is not a registered broker/dealer and is independent of Raymond James Financial Services. Birch Run Financial is located at 595 E Swedesford Rd, Ste 360, Wayne PA 19087 and can be reached at 484-395-2190. Any rating is not intended to be an endorsement, or any way indicative of the advisors abilities to provide investment advice or management. This podcast is intended for informational purposes only.

Each year, we often take a holistic look at our finances.  Today, Alex Cabot and Ed Lambert of Birch Run financial break down what you should be looking at specifically, as we begin 2024.Alex gives us six ponts to consider:If you have an advisor, review your plan and prepare for the upcoming year.Make sure your asset allocation is balanced for your goals., timeframe, and risk tolerance.Ensure your cash is working for you  - there is yield to be found!Pay down your high interest rate debt, especially unsecured debt.Consider adding to your principal mortgage/debt payments -  or consider paying down certain debts slower!Don't pay ANY attention to market predictions for the year - a good allocation can buffer against market volatility.Next, Ed tells us how the Birch Run team is approaching this new year.  They are optimistic for the long term, but fairly neutral on 2024 specifically.   They believe technology will continue to drive growth over the next decades (as it has in the last 40 years).  Also, over the past 50 years, the S&P 500 has had a positive return in 78% of those years.   If this trend holds, you've got roughly a 3 in 4 change of gaining money this year, and a 1 in 4 chance of losing money.    The most important thing is to maintain an even-keeled approach in all types of market fluctuations.   And the benefit of working with a financial advisory team is they can  help keep you honest and take the emotion out of your money. You can always email Alex and Ed at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://www.birchrunfinancial.com/Alex and Ed's Book: Mastering The Money Mind: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal/dp/1544530536 Any opinions are those of Ed Lambert and Alex Cabot and not necessarily those of RJFS or Raymond James. The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. There is no assurance any of the trends mentioned will continue or forecasts will occur. The information has been obtained from sources considered to be reliable, but Raymond James does not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. The examples throughout this material are for illustrative purposes only. Raymond James does not provide tax or legal services. Please discuss these matters with the appropriate professional. Diversification and asset allocation do not ensure a profit or protect against a loss. Past performance is not indicative of future returns. CDs are insured by the FDIC and offer a fixed rate of return, whereas the return and principal value of investment securities fluctuate with changes in market conditions. Securities offered through Raymond James Financial Services, Inc. Member FINRA/SIPC. Investment advisory services offered through Raymond James Financial Services Advisors, Inc. Birch Run Financial is not a registered broker/dealer and is independent of Raymond James Financial Services. Birch Run Financial is located at 595 E Swedesford Rd, Ste 360, Wayne PA 19087 and can be reached at 484-395-2190.

This month, Alex, Ed, and Jag delve into the financial landscape as 2023 draws to a close. The episode, recorded on December 14, reflects on the unexpected market rally in November and the overall performance of various asset classes throughout the year.In mid-November, we discussed the possibility of peak interest rates and high portfolio returns in short periods, based on Alex and Ed's experiences over the last 15 years. Surprisingly, our predictions seemed to materialize, as November witnessed a significant market rally. However, Ed clarifies that this was more due to luck than precise prediction. He emphasizes the importance of long-term investment strategies and staying the course during turbulent times, a philosophy we consistently advocate on the podcast.Ed further explains the concept of "Goldilocks financial data," which contributed to the market's positive performance in November. This term refers to economic conditions that are neither too hot nor too cold, leading to a balanced market scenario. Inflation slowed down, and the job market softened just enough to reduce inflation without triggering fears of an imminent recession. Additionally, the Federal Reserve's dovish statements led many to believe that the interest rate hikes that began in March 2022 might be coming to an end.Alex then provides a detailed analysis of the performance of various asset classes in November 2023. Remarkably, the returns for that month alone were comparable to what would typically be considered a good annual performance. This includes significant gains in large-cap stocks, international stocks, emerging market stocks, gold, commercial real estate, and aggregated bonds. We highlight the unpredictability of such rapid rebounds and the difficulty in timing the market effectively.We also touch on the concept of recency bias, where recent market trends can unduly influence investor expectations. Alex and Ed caution against this, advocating for a balanced and diversified investment approach. They discuss the benefits of rebalancing portfolios, which helps in maintaining a consistent asset allocation over time.In conclusion, prudent asset management, diversification, and staying the course are key to navigating the financial markets.  As always, whether you are a client or not, we invite you to contact the team at Birch Run Financial with any questions you have - financial literacy for all is crucial to our mission. You can always email Alex and Ed at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://www.birchrunfinancial.com/Alex and Ed's Book: Mastering The Money Mind: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal/dp/1544530536 Any opinions are those of Ed Lambert and Alex Cabot and not necessarily those of RJFS or Raymond James. The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. There is no assurance any of the trends mentioned will continue or forecasts will occur. The information has been obtained from sources considered to be reliable, but Raymond James does not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. The examples throughout this material are for illustrative purposes only. Raymond James does not provide tax or legal services. Please discuss these matters with the appropriate professional. Diversification and asset allocation do not ensure a profit or protect against a loss. Past performance is not indicative of future returns. CDs are insured by the FDIC and offer a fixed rate of return, whereas the return and principal value of investment securities fluctuate with changes in market conditions. Securities offered through Raymond James Financial Services, Inc. Member FINRA/SIPC. Investment advisory services offered through Raymond James Financial Services Advisors, Inc. Birch Run Financial is not a registered broker/dealer and is independent of Raymond James Financial Services. Birch Run Financial is located at 595 E Swedesford Rd, Ste 360, Wayne PA 19087 and can be reached at 484-395-2190.

(All data in today's podcast is courtesy of FactSet).More economists are suggesting that the FED is done raising interest rates.  While it's important to note that past returns do not indicate future results, today, we look at some historical data to form an opinion of what might happen after interest rates have peaked.  Alex and Ed sent a note out to clients outlining what the performance of the stock and bond markets in the 12 months following the last six rate hike cycles.   They also discussed 4 periods of very high stock returns over the last 15 years that many "market timers" missed.You can request a copy of this note by emailing Alex and Ed below, and we break it down in today's podcast.Alex mentions that after 5 of the last 6 rate hike cycles, The S&P 500 generated a positive return, averaging 20.6%. And immediate term bond returns made money in all six of these periods, averaging 14.6%.  Again, this does not guarantee future returns, but it's important to look at historical data.Ed then covers 4 recent unexpected high stock return periods.  These all occurred in different environments: March 2009 during the Great Recession,  October 2011 amid economic uncertainty overseas, late 2019 after a very bad Christmas Eve, and of course most recently during the pandemic in March 2020.Why does the market rise in such times of negativity? Ed explains the psychological conditions at play here, that we've seen play out historically.As always, Alex and Ed preach the values of diversifcation and a long term plan.  And trying to "time the market" can often be catastrophic for your financial future.You can always email Alex and Ed at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://www.birchrunfinancial.com/Alex and Ed's Book: Mastering The Money Mind: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal/dp/1544530536Any opinions are those of Ed Lambert and Alex Cabot and not necessarily those of RJFS or Raymond James. The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. There is no assurance any of the trends mentioned will continue or forecasts will occur. The information has been obtained from sources considered to be reliable, but Raymond James does not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. The examples throughout this material are for illustrative purposes only. Raymond James does not provide tax or legal services. Please discuss these matters with the appropriate professional. Diversification and asset allocation do not ensure a profit or protect against a loss. Past performance is not indicative of future returns. CDs are insured by the FDIC and offer a fixed rate of return, whereas the return and principal value of investment securities fluctuate with changes in market conditions. Securities offered through Raymond James Financial Services, Inc. Member FINRA/SIPC. Investment advisory services offered through Raymond James Financial Services Advisors, Inc. Birch Run Financial is not a registered broker/dealer and is independent of Raymond James Financial Services. Birch Run Financial is located at 595 E Swedesford Rd, Ste 360, Wayne PA 19087 and can be reached at 484-395-2190. 

(Data in this podcast courtesy of YCharts and FactSet)Today, Alex Cabot and Ed Lambert of Birch Run Financial dive into the residential real estate market, where interest rates have climbed, but home prices remain high.Ed begins by giving us some context. From late 2019, to late 2021, prices had risen by 29% to $423,000, and interest rates had dropped to about 3%.Why haven't home prices dropped significantly despite higher interest rates? Ed explains that a lack of supply plays a significant role. The demand has decreased somewhat, but the supply has decreased just as much, keeping prices high. He uses the example of first-time homebuyers facing a challenging market.Alex takes the historical perspective, discussing how interest rates have doubled from their 10-year average post-financial crisis. He emphasizes that while today's rates seem high relative to recent years, they are not statistically anomalous in the broader historical context. He also explains the concept of home prices relative to disposable income.Alex underlines the advantage of a 30-year fixed-rate mortgage, which offers a one-way valve.  You can negotiate it down, but your bank can't negotiate it up. Your payments stay the same, but your income typically rises over time, making the mortgage more affordable in the long run. You can always email Alex and Ed at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://www.birchrunfinancial.com/Alex and Ed's Book: Mastering The Money Mind: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal/dp/1544530536Any opinions are those of Ed Lambert and Alex Cabot and not necessarily those of RJFS or Raymond James. The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. There is no assurance any of the trends mentioned will continue or forecasts will occur. The information has been obtained from sources considered to be reliable, but Raymond James does not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. The examples throughout this material are for illustrative purposes only. Raymond James does not provide tax or legal services. Please discuss these matters with the appropriate professional. Diversification and asset allocation do not ensure a profit or protect against a loss. Past performance is not indicative of future returns. CDs are insured by the FDIC and offer a fixed rate of return, whereas the return and principal value of investment securities fluctuate with changes in market conditions. Securities offered through Raymond James Financial Services, Inc. Member FINRA/SIPC. Investment advisory services offered through Raymond James Financial Services Advisors, Inc. Birch Run Financial is not a registered broker/dealer and is independent of Raymond James Financial Services. Birch Run Financial is located at 595 E Swedesford Rd, Ste 360, Wayne PA 19087 and can be reached at 484-395-2190.

Over the last 18 months, the interest rate environment has changed dramatically.  And despite all the headlines, there are actually pros and cons to higher interest rates.   Alex Cabot and Ed Lambert of Birch Run explain.First, the downside.  Alex explains how higher interest rates can slow economic growth and strain households.  First,  the impact on borrowing and investment: individuals are less likely to take out loans when interest rates are up, and business may delay or scale back business plans.  This can lead to increased demand and slower economic growth.Households are also left with less disposable income when more money is going to interest, which can lead to decreased consumer spending.  Further, the housing market is particularly sensitive, with potential homebuyers hesitating jumping into the market.    Finally, small businesses can be affected as well, particularly those who rely on borrowing to finance operations and expansion.But the news is not all bad - Ed is here to talk about the silver linings of higher rates.   First, higher interest rates will slow inflation, which is good for everyone.   Also, for savers and investors, higher interest rates can be a good thing for fixed income, cash deposits, and CD's.   These rates were previously at or near 0%!  This means that investors now have alternatives to the stock market that weren't feasible just a couple of years ago.You can always email Alex and Ed at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://www.birchrunfinancial.com/Alex and Ed's Book: Mastering The Money Mind: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal/dp/1544530536Any opinions are those of Ed Lambert and Alex Cabot and not necessarily those of RJFS or Raymond James. The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. There is no assurance any of the trends mentioned will continue or forecasts will occur. The information has been obtained from sources considered to be reliable, but Raymond James does not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. The examples throughout this material are for illustrative purposes only. Raymond James does not provide tax or legal services. Please discuss these matters with the appropriate professional. Diversification and asset allocation do not ensure a profit or protect against a loss. Past performance is not indicative of future returns. CDs are insured by the FDIC and offer a fixed rate of return, whereas the return and principal value of investment securities fluctuate with changes in market conditions. Securities offered through Raymond James Financial Services, Inc. Member FINRA/SIPC. Investment advisory services offered through Raymond James Financial Services Advisors, Inc. Birch Run Financial is not a registered broker/dealer and is independent of Raymond James Financial Services. Birch Run Financial is located at 595 E Swedesford Rd, Ste 360, Wayne PA 19087 and can be reached at 484-395-2190.

In this episode of "Nurturing Financial Freedom,"  Alex Cabot and Ed Lambert of Birch Run Financial discuss the first half of 2023 and its impact on the economy and markets. Ed highlights the resilience of the economy despite interest rate hikes and the unexpected outperformance of growth stocks, particularly in the technology sector. What does this mean moving forward? Alex emphasizes the importance of diversification and caution against relying on predictions and forecasts. We stress the need for a well-designed plan and asset allocation that can weather any market conditions.All data in today's episode are courtesy of YCharts.At Birch Run Financial, we believe in a time-tested, diversified, long-term approach.  Alex, Ed, and their team are always happy to have a conversation about your investment questions, whether you're a client or not.You can always email Alex and Ed at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://www.birchrunfinancial.com/Alex and Ed's Book: Mastering The Money Mind: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal/dp/1544530536

Money markets, CD's and bonds are paying reasonable interest for the first time in years.  Today, Alex Cabot and Ed Lambert of Birch Run Financial take us on a "crach course" on fixed income and how it works.Alex starts by explaining bonds - essentially a loan, or contract between a lender and borrower.  He also explains the three main bond categories - government, corporate, and agency.   Additionally, we talk about maturity lengths and tax-equivalent yields. Alex runs through an equation that might be easier to read than hear:For interest rates, to find the taxable equivalent of a tax-free bond: take  the yield and divide by (100 - your effective tax rate).Example: Your tax rate is 37%, so 100-37 = 63.    For a 4% yield on a tax free bond, take 4 divided by .63 = 6.35.  Your taxable bond would need to be 6.35% to yield the same as a 4% tax free bond.Like all investments, bonds carry risk - they are just different than the risks associated with the market.  Ed explains credit risk, interest rate risk, and reinvestment risk.   Remember the tradeoff - the higher the interest, the higher the risk.  We also talk about long-term vs short-term bonds, and current rates, as of our recording on June 22, 2023.All data in today's episode are courtesy of YCharts.At Birch Run Financial, we believe in a time-tested, diversified, long-term approach.  Alex, Ed, and their team are always happy to have a conversation about your investment questions, whether you're a client or not.You can always email Alex and Ed at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://www.birchrunfinancial.com/Alex and Ed's Book: Mastering The Money Mind: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal/dp/1544530536

We have a two-part episode for you today, as we begin our fifth year of the Nurturing Financial Freedom Podcast.First, the FED raised interest rates by 0.25% on May 3rd.  Are they finally done raising rates?  Ed Lambert of Birch Run Financial wades into that question.  Are more hikes coming, and if so, will they be small or large?   We look at the current state of the economy and where we believe things are going. Next, Alex Cabot is here to debunk three market "hacks" that investors sometimes get pulled into.  They are:"Sell in May and Go Away""The January Effect""Buy the Rumor, Sell The News"All data in today's episode are courtesy of YCharts, and Alex walks through the numbers of why these market fallacies don't work. At Birch Run Financial, we believe in a time-tested, diversified, long-term approach.  Alex, Ed, and their team are always happy to have a conversation about your investment questions, whether you're a client or not.You can always email Alex and Ed at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://www.birchrunfinancial.com/Alex and Ed's Book: Mastering The Money Mind: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal/dp/1544530536

We celebrate 4 years of the Nurturing Financial Freedom Podcast with our 48th episode today. Thank you for listening! As we reflect on the first quarter of 2023, we will do a recap of the markets (data courtesy of YCharts), as well as reflect on some of the headlines and lessons learned so far this year. Alex starts us off by looking back at the markets, which were largely positive in 2023, as of our recording date of April 20th.  After a stock and bond recap, we spend some time explaining bonds and why they're often a misunderstood asset class.   Also, gold is interesting.   Alex explains why this precious metal is considered both a "panic asset" and an "inflation hedge," perhaps erroneously! Finally, Alex comes back to one of our favorite principles in this show - diversification.  Why is it such an important concept to both understand and utilize? In the second half of today's episode, Ed talks about not believing the predictions of market prognosticators.  Two in particular predicted a very bad Q1 in 2023, which as Alex explained, didn't happen.   You simply can't predict the markets.  Ed explains what would have happened to your portfolio had you made a panic move based on what you saw or read. Next, many investment management firms suggested buying dividend stocks and ignoring growth stocks.  Ed has the numbers to show why that wasn't a good idea!    We also look at the housing market.  While "doom and gloom" were predicted, that didn't come to fruition either!  Yes, interest rates have gone up, but a limited supply has prevented any drastic changes in housing prices. Finally, Ed breaks down the collapse of Silicon Valley bank, an event that dominated the headlines for a few days last month.  Why did the bank collapse?  Ed walks us through the two biggest reasons. So what did we learn, or perhaps have reinforced, in the first quarter of this year?  Don't panic, stay diversified, and focus more on the long-term than the short term.  The world is scary right now, but it always has been and always will be. Alex Cabot and Ed Lambert are always happy to have a conversation with our listeners, whether they are a client or not.  Financial literacy is something they are very passionate about at Birch Run Financial. You can always email Alex and Ed at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://www.birchrunfinancial.com/ Alex and Ed's Book: Mastering The Money Mind: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal/dp/1544530536There are special risks associated with investing with bonds such as interest rate risk, market risk, call risk, prepayment risk, credit risk, reinvestment risk, and unique tax consequences. To learn more about these risks and the suitability of these bonds for you, please contact your financial advisor.Gold is subject to the special risks associated with investing in precious metals, including but not limited to: price may be subject to wide fluctuation; the market is relatively limited; the sources are concentrated in countries that have the potential for instability; and the market is unregulated.Investing involves risk and you may incur a profit or loss regardless of strategy selected, including asset allocation and diversification.Dividends are not guaranteed and must be authorized by the company's board of directors.There are special risks associated with investing with bonds such as interest rate risk, market risk, call risk, prepayment risk, credit risk, reinvestment risk, and unique tax consequences. To learn more about these risks and the suitability of these bonds for you, please contact your financial advisor.Gold is subject to the special risks associated with investing in precious metals, including but not limited to: price may be subject to wide fluctuation; the market is relatively limited; the sources are concentrated in countries that have the potential for instability; and the market is unregulated.Investing involves risk and you may incur a profit or loss regardless of strategy selected, including asset allocation and diversification.Dividends are not guaranteed and must be authorized by the company's board of directors.

As hard as this is to believe, the COVID-19 pandemic started three years ago.  Today, Ed Lambert and Alex Cabot look back at the economy and capital markets over that period.  Interestingly, both are close to where they'd have likely been without a global pandemic. First, Ed looks at the economic data, from Factset, comparing GDP, inflation, unemployment, and the ten-year treasury bond rate.  And despite the stock market having its worst 23 day period ever in 2020, and $5 trillion in stimulus being pumped into the US economy, the unemployment and GDP are close to where they were three years ago.   Yes, inflation and interest rates have changed, but if you told us back in 2020 where we'd be in early 2023, we'd likely have taken it. Alex looks at the markets next, checking the annualized total returns over the last three years.  Thanks to data from FactSet, he looks at Large, Mid, and Small Cap US stocks, Developed International, Emerging Markets, and REITS.    What's most remarkable about these numbers? Well, it's how unremarkable they are.   And this takes into consideration the tumult of early 2020, and the market drop of 2022. As Alex says, we're on a roller coaster.  But they key is not giving into human nature and seeing how high we can go, but rather growing our assets over time. Financial education and literacy are very important to the team at Birch Run Financial. Alex and Ed are always happy to have a conversation with you, whether you're a client or not. You can always email Alex and Ed at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://www.birchrunfinancial.com/Alex and Ed's Book: Mastering The Money Mind: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal/dp/1544530536

Recently, Congress passed the "SECURE 2.0" Act, building on the first SECURE Act it had passed previously.  Today, Alex Cabot will break down what these new changes mean for your retirement, and Ed Lambert will explain why the cavalry is not coming - and the bulk of the responsibility for retirement planning falls to individual investors. SECURE 2.0 will do the following:Raise the RMD age to 73, and will raise it again to 75 in 2033.Cut the Penalty for Missing an RMD from 50% to 25%Exempt Roth accounts in employer retirement plans from RMD requirementsRaise limits on "catch up" retirement contributionsAllow employer match contributions to go into a Roth accountProvide more flexibility with Qualified Charitable Distributions (QCD's)Make changes to rules around Qualified Longevity Annuity Contracts, or QLACs Younger listeners who aren't as close to retirement will want to take note of the following:Automatic enrollment and plan portabilityAn emergency savings plan that is Roth eligible will be available  in defined contribution retirement plans, in 2024Also starting in 2024, employers will be able to "match" student loan payments of employees529 plans, after 15 years, can be rolled into an IRA for the beneficiary What does Ed mean when he says "The Cavalry isn't coming?"   While these new rules are designed to help Americans save for retirement (we've got some scary numbers about how much help we need ), this won't fix everything.   SECURE 2.0 won't automatically provide enough of a nest egg for investors to live off of when they're done working.   The keys to a successful retirement haven't changed. Pensions are largely gone from employee benefit plans, and 46% of workers don't even have a defined contribution plan.  And what about social security? In roughly 10 years, payroll taxes will only cover 75% of the government's obligations.  That could mean higher payroll taxes, cuts to social security  benefits, or both.   Start saving early - compound interest is a powerful tool.   And if you want to work with a professional, Alex and Ed, along with their team at Birch Run Financial, are here to help.   They are always happy to have an initial conversation free of charge. You can always email Alex and Ed at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://www.birchrunfinancial.com/Alex and Ed's Book: Mastering The Money Mind: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal/dp/1544530536 Sources for information in today's show: Pensions are largely gone from employee benefit plans, and 46%[1] of workers don't even have a defined contribution plan.  And what about social security? In roughly 10 years, payroll taxes will only cover 75%[2] of the government's obligations.  That could mean higher payroll taxes, cuts to social security benefits, or both.   [1] Source: Bureau of Labor Statistics[2] Source: Social Security Administration

What can we expect from the financial markets in 2023?  Obviously 2022 was not a great year for investors. Today, Alex gives us a recap of last year, and Ed explains why the team at Birch Run Financial is optimistic heading in to the new year.Alex recaps many of the difference indices' performance in 2022, including the S&P 500, the Bloomberg US Aggregate Bond index, and more - courtesy of FactSet.Yes, the financial media are right when they talk about 2022 being the worst year since the 2008-2009 financial crisis.  But remember, the job of the financial media is to keep us engaged.  Alex digs a little deeper to find we are not where we were 15 years ago.  In fact, the three year period from 2020-2022 looks much better than a similar period during the financial crisis.Ed is here to look forward to 2023.  And while of course nobody can predict the market, we could be seeing some things to cause optimism.  Bond yields are reasonable, and as clients approach retirement, bonds are often a bigger part of their overall investment strategy.   Also, Price to Earnings, or P/E ratios, are looking better.  Ed explains what these numbers represent, and why this is a good thing.We also talk about the dreaded "R word" - recession.  How likely are we to see one in 2023?  Well, depends on who you ask. But it's important to remember that recessions are part of the normal economic cycle, and a good financial plan accounts for them to happen.You can always email Alex and Ed at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://birchrunfinancial.com/Alex and Ed's Book: Mastering The Money Mind: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal/dp/1544530536 

It's been almost a decade and a half since we've seen a market downturn like we have in 2022.  And while you may not be happy when you look at your investments, our current environment may provide some opportunities that investors haven't seen in some time.   Today, Ed Lambert and Alex Cabot of Birch Run Financial explain.First, Ed tackles Roth Conversions.   On a traditional IRA, you pay the taxes on the way out.  On a Roth, you pay them on the way in.  This is also true at the time of a conversion - that's when you pay the taxes.  And while every individual's situation is different, reasons to do a Roth conversion could include people who are young, people with lower incomes, and in 2022's case, when the value of your investments are down.   Ed explains all of this with examples, and also tells us why it's a good idea to have the money to cover the taxes come from elsewhere.Next, Alex talks about tax loss harvesting.  Again, this is a complex strategy, and you should always consult with a professional before executing it.  Essentially, if you want to sell securities at a loss, you can use those losses to offset any capital gains you have - for tax purposes.   There are many caveats here, too, though.  Alex cautions us not to prioritize tax strategy above overall investment strategy.  And there are other factors to consider, like the IRS Wash Sale Rule.  He shares one particular horror story involving this strategy.As the year winds down and you consider your financial future, Alex, Ed, and the team at Birch Run Financial are always happy to have a complimentary conversation with you.You can always email them at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://birchrunfinancial.com/Alex and Ed's Book: Mastering The Money Mind: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal/dp/1544530536

With the mid-term elections one week away, many of Alex and Ed's clients and podcast listeners are wondering how the markets will be affected by the results on November 8th.Alex did some digging into this, looking at the every President since Kennedy, comparing market returns of the first two years of their term to the total length of the term.   We start the podcast by digging in to those numbers, in search of some historical data.  The bottom line is that the numbers do not provide us with a tradeable strategy.  And the same is true with divided government  - either when Congress is split, or when it's controlled by one party with the other party occupying the White House.   Divided government may show slightly better returns.  However, stepping out of the market during times of unified government could keep you on the sidelines, missing out on market gains.In the second half of today's episode, Ed looks to the future, and what market analysts are saying about the 2022 election.  Most are predicting divided government over Biden's next two years, with the Republicans likely to take the House, and Senate being a virtual tossup.    With divided government, any major legislation is unlikely to pass.   And even if the Democrats control the White House, Senate, and House, fears of inflation on both sides of the aisle may make major bills unlikely to pass.   Many bills are passed with the spending up front and revenue coming in later, which would only add to inflation.Keep in mind, Jay Powell and the Federal Reserve are not affected by midterm election results.  It will be up to them to act to try and curb inflation while avoiding recession - a tough line to walk as we've discussed in previous episodes.  The bottom line is this - Americans have a number of factors sending them to the polls on November 8th.  But fear of economic chaos should not be one of them.Have questions about your financial future?  Alex and Ed are always happy to have a conversation, whether you're a client or not.  You can always email them at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://birchrunfinancial.com/Alex and Ed's Book: Mastering The Money Mind: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal/dp/1544530536

Investors often get caught up in the idea of "average returns."  Today, Alex Cabot and Ed Lambert of Birch Run Financial explain why that mindset can be dangerous.  Average returns can be looked at over a longer period of time,  but very few years are even close to "average."First, Ed explains the concept of standard deviation - and the expectation that 66% of years can be expected to be within one standard deviation.  Here's an example:A portfolio's average annual rate of return is 6%, with a standard deviation of 10% in either direction.That means, in a 30 year period, the return will be between -4% and +16% in 20 of those years.However, that means in the remaining 10 years, you'll see returns less than -4% or more than +16%.  Understanding the math and knowing that these wild swings can happen in individual years can prevent making rash buying or selling decisions based on market conditions.  This is explained in Alex an Ed's book, Mastering the Money Mind (link here.)In the second part of our episode, Alex breaks down the historical numbers that reflect this idea.  Since 1980, the S&P 500 has achieved an annualized price return (not including dividends) of 9.4% per year.How many times since 1980 has been within even one percent of that average (8.4%-10.4%)?  Just twice.What about within two percent? Just three times.Ten percent? The S&P was within 10% of it's average only 18 times since 1980.   That means it returned less than -0.6% or more than +20.4% over twenty times in the last 4 decades!   So while an average is helpful to look at in the long term, we simply can't chase it on a year to year basis.Investors often get hung up in what they are invested in, as opposed to why they are investing - which is to grow their money over a long time period.   Alex, Ed, and Jag conclude by talking about "zooming out" on the graph to see long term trends.  And Alex explains how to do this to get an accurate representation of historical data.Finally, Alex and Jag mention their Moms - and how supportive they've been.  You'll hear how that ties in to our conversation.Have questions about your financial future?  Alex and Ed are always happy to have a conversation, whether you're a client or not.  You can always email them at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://birchrunfinancial.com/Alex and Ed's Book: Mastering The Money Mind: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal/dp/1544530536

Investment Time Horizons are a concept that Alex Cabot and Ed Lambert feel is often misunderstood by investors. Alex starts with the two main factors we need to consider: how long until you need the money and how long you will draw on it. This will affect how you invest, even if the spending goal is the same distance away.Next, Ed explains why the duration of the distributions is so vitally important.  This relates back to the word of the year so far in 2022 - inflation.   It will cost more to buy the same goods and services in the future as it does today.    We walk through some real world numbers to illustrate this point.Today's key takeaway is that both time horizons - how long you save and how long you withdraw - are equally as important.  And being too aggressive - or too conservative - can be very costly mistakes.Have questions about your financial future?  Alex and Ed are always happy to have a conversation, whether you're a client or not.  You can always email them at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://birchrunfinancial.com/

Where do the financial markets sit as we've hit the halfway point of 2022? Ed Lambert and Alex Cabot are here to break it all down, in terms of what it means for you as an investor.Obviously, the big word of the year is Inflation.  Ed explains how bad it is.  Also, what's driving inflation? Is it COVID stimulus money, the war in Ukraine, or China's current COVID lockdowns?  Well, it's all three.  Ed talks about how the FED is trying to combat inflation with rising interest rates, and the fine line they have to walk between curbing inflation and not causing a recession. Alex takes a deeper dive on asset classes.  How have stocks, bonds, precious metals, and cash performed in 2022? And what are some sources of optimism as we approach the second half of the year?  And what does airplane turbulence have to do with all of this?Have questions about your financial future?  Alex and Ed are always happy to have a conversation, whether you're a client or not.  You can always email them at info@birchrunfinancial.com or give them a call at 484-395-2190.Or visit them on the web at https://birchrunfinancial.com/

Alex Cabot and Ed Lambert of Birch Run Financial have been working in this industry for over 20 years, and they've seen a lot of interesting financial products.  Today, they take a look back at some of these investments and why they didn't work out.  The list includes:Negative Amortization MortgagesFinancial EngineeringHigh Yield Debt/Bond ProductsIlliquid and Opaque StrategiesFixed Index AnnuitiesCryptocurrencyViatical SettlementsAnd finally, totally fraudulent products and strategiesIn the end, it all boils down to common sense.  If an investment strategy appears too good to be true, promising unrealistic returns, that should give you pause.  That's why Alex and Ed believe in a long term, diversified investment strategy.  If you'd like to have a free, no-obligation conversation with them and the team at Birch Run Financial, reach out. Birch Run Website: www.birchrunfinancial.comBirch Run Financial email: info@birchrunfinancial.comBirch Run Financial Phone Number: (484) 395-2190Alex and Ed have a new book out, Mastering the Money Mind: A New Way of Thinking About Personal Finance.  You can contact them below for a copy or find it on Amazon here: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal-ebook/dp/B09YB9J315 

Often, Alex Cabot and Ed Lambert at Birch Run Financial are asked about how the political environment can affect investments.  Today, we take a deep, non-partisan dive into that very question.First, Ed takes the 30,000 view.  On average, it doesn't matter which party is in charge in Washington - Democrat or Republican.  There is a small uptick in returns when the government is divided, as opposed to one party controlling Congress and the White House. What does come into play though, is confirmation bias.   Individual investors often minimize downturns when their party is in power, yet blame the opposite party when markets are down on their watch.  Bottom line, the market has been on the pace of a 12-4 NFL team.  (And yes, this point led to some heated Patriots-Eagles trash talk.)Next, Alex breaks down the specific data when it comes to political parties. We look at every Administration since 1981, as well as rolling 48 and 96 month averages.   This information proves that, once again, it's not timing the market, but rather time in the market that counts.Finally, with all the talk about media bias and political bias,  Alex provides some historical context.  Our current climate is not without precedent.Alex and Ed have a new book out, Mastering the Money Mind: A New Way of Thinking About Personal Finance.  You can contact them below for a copy or find it on Amazon here: https://www.amazon.com/Mastering-Money-Mind-Thinking-Personal-ebook/dp/B09YB9J315Birch Run Website: www.birchrunfinancial.comBirch Run Financial email: info@birchrunfinancial.comBirch Run Financial Phone Number: (484) 395-2190

Today we're going to talk about the job market in the US.   As we've discussed in the past, the job opportunities for workers at this point are plentiful.   Each coin has two sides, though.   Not everything about the job market is ideal.  First, Alex looks at the good side, including:Low unemployment rateLarge number of job openingsThe gradual ebb of COVID-19 and the return of more people to the office.However, there's also a down side.  Ed looks at that, including:Market imbalance between job openings and unemployment workersGreater workload on those workingHigher wages contributing to the price/wage spiral and inflationSupply chain issuesAlex and Ed talk about one part of the solution to these issues, and their idea may surprise you!Finally, Alex has a big announcement for something coming from Birch Run Financial in May.Birch Run Website: www.birchrunfinancial.comBirch Run Financial email: info@birchrunfinancial.comBirch Run Financial Phone Number: (484) 395-2190

The Russian invasion of Ukraine, in addition to a terrible humanitarian toll, has also affected the financial sector. We've seen increased market volatility. Today, Alex Cabot and Ed Lambert of Birch Run Financial explain the importance of having adequate liquid cash reserves, and what they should look like.First, Ed explains the importance of having a "war chest," if you will. This is so important when it comes to protecting yourself against market volatility and unexpected expenses.Next, Alex breaks down examples of what that war chest should look like.  What is adequate, and what isn't?Need help creating your own financial war chest?  Or do you need advice on anything related to your financial future?Birch Run Website: www.birchrunfinancial.comBirch Run Financial email: info@birchrunfinancial.comBirch Run Financial Phone Number: (484) 395-2190

Over the first two months of 2022, we've heard a lot of reasons to worry about the market and our overall financial future.  However, Alex Cabot of Birch Run Financial recently wrote a white paper on  4 reasons to be optimistic at this point.  Today we break them down:The economy, specifically measured by GDP, is strong.Consumers are confident.Businesses are optimistic.Employment situation.Nest, Ed Lambert explains his three reasons to be optimistic as we look forward.Technological GrowthPopulation DemographicsThe US Free Market SystemWhile past performance does not guarantee future results, Ed spends a few minutes on historical data, showing the best and worst case scenarios for investors with a 50/50 stock bond mix over the last 71 years.  The results may surprise you.Birch Run Website: www.birchrunfinancial.comBirch Run Financial email: info@birchrunfinancial.comBirch Run Financial Phone Number: (484) 395-2190Alex's LinkedIn for his white paper: https://www.linkedin.com/in/alexander-cabot-b5a359b/

Today, Alex Cabot and Ed Lambert of Birch Run Financial cover two main topics.  First, Ed tells us the four things everyone should do to start the new year.  Then, Alex talks about how investors should be viewing the current financial environment.Ed talks about:Increasing your retirement contributionsEliminating high interest rate debtAdding to your monthly mortgage paymentChecking your investment strategyAlex covers:How the markets have responded to the Omicron variantInflationCommon mistakes with asset allocationGeneral investment strategy, dependent on your individual situation.Birch Run Website: www.birchrunfinancial.comBirch Run Financial email: info@birchrunfinancial.comBirch Run Financial Phone Number: (484) 395-2190

"Fed Tightening" is a term we've been hearing a lot lately.  Today, Alex Cabot and Ed Lambert of Birch Run Financial explain the term, and why it's relevant now, at the end of 2021.The Federal Reserve, or "The Fed," has two main weapons in its arsenal: Short Term Interest Rates and Money Supply.  Alex explains how these two tools can be used to bolster a struggling economy, or, like now, slow the rate of inflation.Ed explains why this is a relevant discussion now.  Recent policy has gotten us through the pandemic, but now, with the rise of inflation, savers are disadvantaged when you compare them to borrowers.  Also, for Americans living paycheck to paycheck, their wages may not be keeping pace with their bills.  And finally, inflation brings with it the possibility of greater inflation. Birch Run Website: www.birchrunfinancial.comBirch Run Financial email: info@birchrunfinancial.comBirch Run Financial Phone Number: (484) 395-2190

Birch Run Website: www.birchrunfinancial.comBirch Run Financial email: info@birchrunfinancial.comBirch Run Financial Phone Number: (484) 395-2190On this podcast, Alex Cabot and Ed Lambert often preach the importance of diversification - having many different types of investments in your portfolio.  Today, Ed breaks that down from a 30,000 foot view.   And much to Jag's appreciation, he even has a Tom Brady analogy.We also explain correlation - how different asset classes interact with one another and why that's important in constructing your portfolio.  From there, Alex breaks down portfolio risk and return efficiency.If you have questions about your financial future, you can always talk to Alex, Ed, and the team at Birch Run Financial.  Their contact information is above.

Birch Run Website: www.birchrunfinancial.comBirch Run Financial email: info@birchrunfinancial.comBirch Run Financial Phone Number: (484) 395-2190Fiscal Stimulus and Monetary Stimulus, ExplainedSince the beginning of the pandemic, we've been hearing about fiscal stimulus and financial stimulus.  Today, Alex Cabot and Ed Lambert of Birch Run Financial break them both down.Fiscal Stimulus:When the government increases spending, cuts taxes, or both.Can be measured by "Fiscal Multiplier," or "bang for your buck."We've implemented 5 specific cats of fiscal stimulus since the beginning of 2020.Returning to normal could be trick and could involve higher taxes on some Americans and businesses.Monetary Stimulus:Created through the Federal Reserve's management of interest rates and the money supplyQuantitative EasingLow interest rates have resulted in TINA - "There Is No Alternative" Wealth EffectThis was implemented quickly, but must be stopped slowly. 

Birch Run Website: www.birchrunfinancial.comBirch Run Financial email: info@birchrunfinancial.comBirch Run Financial Phone Number: (484) 395-2190Do I Need Bonds in My Portfolio?We begin today's episode with a quick market recap of the past month, then we get into a question that Alex Cabot and Ed Lambert of Birch Run Financial are frequently asked.  "Do I Need Bonds in My Portfolio?"First, Ed explains what bonds are and how they work.  And while bonds are often more stable than stock investments, bonds do carry three risks. Ed walks us through them. They are:Credit RiskInterest Rate RiskCall/Reinvestment RiskThen, Alex explains why investments are important to a investor's portfolio, and who should own them.  He breaks down time horizon, short and long term financial goals, and even retirement horizon. These are all factors that should be considered when looking into bonds for your portfolio.

Gamification of investing refers to the idea that investing is a "game" that can be won or lost.  Alex Cabot and Ed Lambert of Birch Run Financial are here to break down this trend.Alex starts by walking through the fundamentals of this gamification, and the effort to democratize investing.  He also provides some historical context into where this trend fits.  There is a downside to this trend, however.  Ed explains the risks and dangers that gamification can pose to the average investor. Investing or day trading with apps can be exciting, but if you're investing life changing money, the standard tenets of investing apply.Alex also shares the tragic story of a young Robin Hood investor who didn't fully understand the strategies he was employing. It resulted in him taking his own life.If you have any questions about investing, retirement planning, or anything relating to your financial future, we encourage you to talk to Alex Cabot and Ed Lambert at Birch Run financialWebsite: www.BirchRunFinancial.comEmail: info@birchrunfinancial.comOn Facebook: Birch Run FinancialOn Twitter: @BirchRunFinancePhone: (484) 395-2190

Today, Alex Cabot and Ed Lambert of Birch Run Financial provide an update on the economy and the markets, through the second quarter of 2021.Ed explains, how in terms of GDP, we are growing faster than at any point since 1984!  We've recovered all pandemic-related losses, and any further economic growth will be new.The employment rate is improving, and Ed explains why we expect it to get better over the second half of 2021.  We also cover the housing and auto markets, as well as the federal reserve and interest rates.Turning to the markets specifically, Alex talks about their resiliency after the initial shock of COVID in the spring of 2020.  We look at growth vs value stocks, and low volatility. Valuations have gone down while stocks have risen.Alex and Ed's key takeaway: We can't predict the ups and downs of the market (and the world),  but diversification and an overall financial plan can help protect your future.If you'd like help with your financial future, connect with Alex, Ed, and the team at Birch Run Financial:Website: www.BirchRunFinancial.comEmail: info@birchrunfinancial.comOn Facebook: Birch Run FinancialOn Twitter: @BirchRunFinancePhone: (484) 395-2190

After a brief check of the markets over the last month, we jump into today's big topic.Inflation has been a major topic in the financial media lately. The question is: Will current inflation be transitory (temporary) or will it last?  Today, Ed Lambert and Alex Cabot of Birch Run Financial play devil's advocate and present each side of the argument.First, Ed outlines the argument that inflation is here to stay:The Fed has changed their guidance to allow for inflation to average 2%, and it's previously been low.The Fed is currently more interested in maximizing employment than managing price stability.The money supply (M2) is 20% higher than a year ago, and the dollar may weaken.There are labor supply shortages.Inflation often leads to more inflation.Next, Alex explains why other experts believe inflation is temporary.Supply chain bottlenecks will soon ease up.Stimulus money that we received will eventually be spent.April CPI data was driven largely by the used car market, not a commodity that people tend to buy often.Unemployment in the service sector has driven price increases.  As extra unemployment benefits dry up, those industries will see people return to work.While Ed and Alex both present compelling arguments on each side, they believe the truth may be somewhere in the middle. No matter what the future holds, however, the team at Birch Run is here to help you prepare for it.If you'd like help with your financial future, connect with Alex, Ed, and the team at Birch Run Financial:Website: www.BirchRunFinancial.comEmail: info@birchrunfinancial.comOn Facebook: Birch Run FinancialOn Twitter: @BirchRunFinancePhone: (484) 395-2190

We begin today's episode with a check of market performance from April 15th-May 15th.   Ed Lambert walks us through the changes in the S&P 500, small cap market, Russell 2000, and more.The focus on today's podcast is fire drills. Markets can be volatile and uncertain. There are pullbacks, corrections, and bear markets. Alex Cabot walks us through some of the more recent incidents of each, including the COVID response last year.   The proper time to "stress test" your portfolio, or run a fire drill, is when the market is doing well.  This will enable you to create and evaluate a plan more objectively, without the stress of a down market. Ed then gives us an example portfolio, explaining how it will perform in various market conditions.   And it's important to remember Warren Buffet's advice:  The market, short term, is a voting booth.  But in the long run, it's a weighing mechanism.If you'd like help with your financial future, connect with Alex, Ed, and the team at Birch Run Financial:Website: www.BirchRunFinancial.comEmail: info@birchrunfinancial.comOn Facebook: Birch Run FinancialOn Twitter: @BirchRunFinancePhone: (484) 395-2190

With so many different types of investments considered "hot" right now, Alex Cabot and Ed Lambert thought this the perfect time to revisit the importance of diversification.Hot asset classes don't necessarily remain hot, and "cold" classes aren't "overdue."  Past performance does not indicate future results, and your best chance at success is a properly diversified portfolio.Alex and Ed provide hard data about just how volatile these different asset classes have been, just over the last few years.Lately, there's been a trend of market leaders changing from fast growing tech companies to higher dividend paying companies.  Ed breaks that down for us.Connect with Alex, Ed, and the team at Birch Run Financial:Website: www.BirchRunFinancial.comEmail: info@birchrunfinancial.comOn Facebook: Birch Run FinancialOn Twitter: @BirchRunFinancePhone: (484) 395-2190

Over the past weeks and months, we've heard many stories in the financial media about inflation, when it's coming, and what it will mean.  Today, Ed Lambert and Alex Cabot of Birch Run Financial break it all down.Ed talks about the massive amount of money we have flowing through our financial system, thanks to historically low interest rates, economic stimulus money, and the pent up demand that will spring once we all get vaccinated.Goldman Sachs is estimating a 7% growth to the US GDP in 2021, a very significant number - Ed breaks it down.With the potential of higher inflation, what should investors do?  Alex talks about which asset classes overperform and underperform in environments of inflation.Alex also explains 4 things that we should do now:Don't PanicEvaluate Your Portfolio as it relates to your planLook at the big picture, then dive into the minutiae.Talk to an advisor!Connect with Alex, Ed, and the team at Birch Run Financial:Website: www.BirchRunFinancial.comEmail: info@birchrunfinancial.comOn Facebook: Birch Run FinancialOn Twitter: @BirchRunFinancePhone: (484) 395-2190

We often hear advisors say "Don't chase returns."  But what does that really mean? Today, Alex Cabot and Ed Lambert of Birch Run Financial explain, and why this advice is so important.Chasing Returns is really about FOMO, or "keeping up with the Joneses."  Psychologically, we hear about a hot stock or other item, and we don't want to miss out. We've seen this with tech, commodities, even real estate.  The problem is, these items can be artificially inflated, and that bubble will eventually burst.  Advisors will always say "buy low and sell high."  Chasing these "hot" items means you're doing exactly the opposite.The best way to avoid the pitfall of chasing returns is to diversify your  portfolio and avoid the noise.  According to Delbar, most individual investors underperformed the market in the period from 1999-2019. Why? They gave in to their emotions and deviated from their long term plans.  And a bad investment can set you back far more than a good investment can put you ahead. Know who you are as an investor, understand risk well, and assume that things could get ugly at any time.Connect with Alex, Ed, and the team at Birch Run Financial:Website: www.BirchRunFinancial.comEmail: info@birchrunfinancial.comOn Facebook: Birch Run FinancialOn Twitter: @BirchRunFinancePhone: (484) 395-2190

We are all grateful to put 2020 in the rear-view mirror and turn the page to 2021.  Today, Ed Lambert and Alex Cabot of Birch Run Financial join Jon Gay for a 2021 economic outlook and what investors should expect in the coming year.Ed breaks down the importance of COVID-19 vaccines, and why they are key to the expected economic recovery. If we can reach "heard immunity," consumers' pent up demand will help suffering industries, like restaurants and travel.  The hope is, a year from now, we will look back on a solid 2021 and forward to a good 2022.Alex then tackles the investor piece of 2021's Outlook.  The market appears more optimistic than it did 6 months ago, with the assumption the vaccine rollout and administration will go according to plan.  Overall, 2020 was a good year for the market, independent of the pandemic. Bottom line: having a financial plan to anticipate any volatility will protect you against short term changes in the market.Connect with Alex, Ed, and the team at Birch Run Financial:Website: www.BirchRunFinancial.comEmail: info@birchrunfinancial.comOn Facebook: Birch Run FinancialOn Twitter: @BirchRunFinancePhone: (484) 395-2190