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02.17.2023 by Gerrit Petersons

A Bumpy January CPI Report

January Consumer Price Inflation: January’s consumer price index (CPI) report came in the highest since October 2022, with headline inflation rising 0.5% in January, up 6.4% year over year. Core CPI, excluding food and energy prices, rose 0.4% and 5.6% respectively. Another measure the Federal Reserve follows, core services ex-housing, rose 0.3% largely driven lower by a decline in medical care services; excluding that, services inflation rose 0.8%. A difficult report to interpret and following the strong January jobs report, recent data may result in the Fed continuing interest rates hikes or keeping rates higher longer than anticipated. To further muddy the water, this inflation report includes new seasonal adjustments by the Bureau of Labor Statistics. U.S. CPI | Bloomberg  January CPI | Axios

Syria/Turkey Earthquake: A February 6th earthquake rocked southeastern Turkey and northern Syria, with over 35,000 now reported dead. The disaster was compounded by the faulty construction of buildings. Colder, winter weather conditions make finding survivors less and less likely. In graduate school, I took some classes with Syrian students. They were all very kind, sometimes sharing snacks or tea from their first meal of their day after sundown during Ramadan. There are always stories of miracles and hope that keep people going during these tragedies but the cleanup efforts have been slow in some regions. For a region that has been through so much in recent years, it's heartbreaking. Earthquake | PBS NewsHour

The Loons, The Loons: Not your “On Golden Pond” variety but there have been multiple balloons and unidentified objects blasted out of the skies by U.S. jets in recent days. Since the February 4th Chinese balloon was shot down off the coast of South Carolina, three other objects have been shot down between February 10th and February 12th from Deadhorse, AK to Lake Huron, MI. This has added to tensions between the U.S. and China, with China accusing the U.S. of using balloons more than 10 times in surveillance operations in China. It’s unclear if the objects shot down are connected in some way and the U.S. initially did not rule out the possibility of extraterrestrials. In the words of Dana Scully, “Mulder, the truth is out there, but so are lies.” Balloons | Bloomberg

Maine Pandemic Relief Checks: The IRS ruled that Maine’s (and 16 other states’) 2022 Covid Relief/high Inflation checks issued are not subject to federal taxes. This comes as many individuals already filed taxes and some held off on filing, awaiting the decision. This ruling is not applicable to the $450 heating cost relief checks approved in 2022 and delivered in 2023. Pandemic Relief Checks |

Financial Planning/Investment Strategy Corner:

Higher Rates Benefit Some: Interest rate hikes have disproportionate impacts on savers vs. spenders. Given the pace of Federal Reserve interest rate hikes, it has changed very quickly in favor of savers. While rates are higher, some banks and credit unions have not passed on that rate increase to their savings account customers and we are seeing rates at local banks between 1.75% and 2.50%. If you have excess savings, there are other ways to take advantage of higher rates. You could purchase a money market fund, one only holding government debt, and may be able to obtain yields over 4.0%. Additionally, by buying short and intermediate-term individual CD’s and U.S. Treasuries you may be able to obtain yields between 4.0% and sometimes as high as 5.0%. Contact your advisor if you have questions about savings rates and how best to take advantage of recent rate increases.

Quick Hits:

  • We all were not surprised for Portland, ME and Portsmouth, NH to come in at 1 and 2 as the best places to live on the East Coast according to Travel and Leisure Magazine. Also unsurprising, no mention of -50 degree wind chills in this article. Portland and Portsmouth | Travel and Leisure
  • Pizza and Oligopolies, just a few of my passions: Pizza Box | DNyuz, Pizza Box | The Atlantic
  • As Hollywood’s intellectual property copyrights expire, we may need to be more careful before watching movies or TV shows synonymous with childhood. Pooh Bear | NYT Also, with Batman’s copyright expiring in 2035, if we have not hit Batman saturation already, expect it to happen soon. Copyright | Economist
  • Something to pay attention to while driving or walking around Portland: Portland’s Muralist | Press Herald
  • This article made me feel better about my opera knowledge. My more classically educated wife has told me a few times, “You know that song, it’s from Bugs Bunny.” Opera | Boston Globe

The Last of Us The Last of Us | HBO Max:  Coming out of a global viral pandemic and choosing to watch a dystopian TV series about a fungal pandemic was not something I expected to be doing. Adapted from a video game, the HBO Max series expands on the plot and characters, while staying true to the original story of a fungal infection creating zombies and the characters navigating a post-plague world (FUN!). The acting is excellent, the plot is strong, and the videography is stunning. There is a little humor sprinkled in tastefully as well. So far, the setting is a near unrecognizable 2023 Boston in ruins, so it’s fun to try to figure out where they are in the city (“Oh! That’s the North End.”). And like other HBO series, it’s fun to try to place the actor or actress from an earlier HBO series. On the bright side, it is fiction and a fungus is unlikely to bring about a dystopian hellscape for a variety of reasons. The Last of Us | NPR

Well that Wasn’t Very Productive: I am a list maker. I write ‘to do’s’ down to remember them better, then I create a new ‘curated’ list of what I think I can feasibly do in an allotted amount of time. I did not know that it was a practice known as the Bento Methodology. I never saw the use in keeping a master list of everything you need to do because it just felt overwhelming. The physical act of crossing off a completed task pleases some people; I think I just enjoy completing the task. The Bento Methodology is not perfect - untimely interruptions and juggling priorities tend to leave you feeling like you did not complete what you planned. It may not be for everyone but it helps me. I definitely would not recommend suggesting this method to a spouse or coworker who you know enjoys crossing items off lists, because they might just cross you off next.

2023 Winter Wine Event: Last week the RSWA team enjoyed getting back into the swing of things in person at the Winter Wine Event at the beautiful Wentworth by the Sea in New Castle, NH. A good time was had by all at the sold-out event with great food and wonderful new wines discovered. We look forward to an event in the Portland area later this year.

Quote: “It’s a real moment of maturation to say, ‘My time here is short – what can I do the most beautifully?’” – George Saunders

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