INFLATION: The Interest Rate Balancing Act

Posted on July 27, 2023 by Dr. David Edward Marcinko MBA MEd CMP™

By Staff Reporters

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Whether we’ll see another interest rate increase soon depends on what happens between now and the Fed’s next meeting in September. Jerome Powell will be watching to see if consumer prices come down more than they already have, thanks to previous rate hikes.

There are some promising signs that the worst is behind us:

  • Tomorrow, when the government releases the latest personal consumption expenditures price index—the Fed’s preferred measure for tracking inflation—it’s expected to show the lowest inflation increase since the end of 2021. And last month, the consumer price index showed inflation fell to 3%, which is above the Fed’s 2% target but an improvement from last June’s 9.1%.
  • Meanwhile, Coca-Cola—whose prices were 10% higher last quarter compared to Q2 2022—said it’s done marking up drinks for the year, and the CFO of Unilever said the packaged goods giant’s price inflation has peaked (though prices may still get higher).

But the FOMC wants more: Chairman Powell said that for inflation to be truly conquered, the job market, which currently boasts a low unemployment rate of 3.6%, will need to slow.

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DAILY UPDATE: Dow and Fed Up but Markets Down

Posted on July 27, 2023 by Dr. David Edward Marcinko MBA MEd CMP™

By Staff Reporters

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The Federal Reserve raised its benchmark interest rate another 0.25% on Wednesday, reviving its inflation fight despite a significant cooldown of price increases in recent months. The rate hike brought the Fed’s benchmark interest rate to a 22-year high of between 5.25% and 5.5%. Inflation has fallen significantly from a peak last summer, but remains at a level one percentage point higher than the Federal Reserve’s target of 2%.

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The Dow on Wednesday rose for a 13th straight day, matching its longest winning streak since 1987. If it closes higher today, it would be a streak not seen since 1897 — about a year after the benchmark was created — when the Dow advanced for 14 sessions in a row. During this latest run, the Dow has outperformed, gaining 5%. That momentum hasn’t been seen in the broader S&P 500 and NASDAQ Composite indexes, however. Both are up just 3% since the Dow’s streak began. The S&P 500 has fallen twice in that time, while the NASDAQ has posted three losing sessions

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Here is where the major benchmarks ended for the day:

  • The S&P 500 Index was down 0.02% at 4,566.75; the Dow Jones Industrial Average (DJIA) was up about 82 points (0.23%) at 35,520.12; the NASDAQ Composite was down 17 points (0.12%) at 14,127.28.
  • The 10-year Treasury note yield (TNX) edged down to 3.867%.
  • CBOE’s Volatility Index (VIX) dropped 5 points to at 13.32.

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ORDER: https://www.routledge.com/Comprehensive-Financial-Planning-Strategies-for-Doctors-and-Advisors-Best/Marcinko-Hetico/p/book/9781482240283

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MENTAL HEALTH: The Parity and Addiction Equity Act?

Posted on July 27, 2023 by Dr. David Edward Marcinko MBA MEd CMP™

By Staff Reporters

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President Joe Biden’s administration just announced new rules meant to push insurance companies to increase their coverage of mental health treatments.

DR KENT: https://medicalexecutivepost.com/2023/05/26/dr-kent-may-is-mental-health-month-2/

The new regulations, which still need to go through a public comment period, would require insurers to study whether their customers have equal access to medical and mental health benefits and to take remedial action, if necessary.

MORE: https://medicalexecutivepost.com/2023/06/23/june-mens-mental-health-month/

The Mental Health Parity and Addiction Equity Act requires that insurers provide the same level of coverage for both mental and physical health care — though the administration and advocates argue insurers’ policies restrict patient access.

ACT: https://www.cms.gov/CCIIO/Programs-and-Initiatives/Other-Insurance-Protections/mhpaea_factsheet

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