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Mark's regular column in the Idaho Statesman's Business Insider tackles local, national, and international financial issues in a thoughtful, approachable way. It has also been a great creative outlet for Mark, who loves to write and share his extensive experience with his fellow Idahoans.

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Business Insider
October 2018

Year-End Financial Tips

When it comes to money, many Americans have elevated procrastination to an art form. What is it about planning, budgeting and saving that causes many of us to curl up in the fetal position? Overwhelming? Absolutely! Daunting? Certainly! Doable and possible? Of course!

And if you start now you can boost your savings, reduce your taxes, and virtually eliminate your holiday stress in December.

Review Your Investments: Don’t forget your mutual fund year-end capital gains projections when estimating 2018 taxes. Taxpayers with lower incomes during retirement may qualify for zero percent long-term capital gains. Sell positions with losses during this quarter to claim tax benefits this tax year. If capital losses exceed capital gains, you may use up to an additional $3,000 to reduce taxable income—carry over the excess amount to next year.

Charitable Gifts: Your contributions to charities must arrive by the end of the calendar year; appreciated stock gifts and donor advised funds have earlier deadlines. Itemized gifts must exceed the new higher standard deductions to remain deductible. Consider doubling up gifts to your favorite charities this year. For those of you age 70 ½ years young, consider the qualified charitable distribution, or QCD, that allows direct gifting from your IRA directly to a charity. It may satisfy some or all of your required minimum distribution, or RMD.

Retirement Plan Accounts: You can defer up to $18,500, and avoid some taxation, in your employer sponsored plan. People ages 50 and older can defer up to $24,500 by the year-end deadline. Many companies have reinstated or increased the employer matching contribution, so grab that extra benefit! You can accrue more long-term tax advantages using the Roth 401(k) option, if your company offers it. If your company lacks a plan, stop making excuses and set up an individual plan with your advisor.

Education Savings: Contributions to education savings accounts and 529 plans grow tax deferred. Some states, including Idaho, allow a tax deduction for contributions. You can use up to $10,000 per year per beneficiary to pay tuition for K-12 students. Check with your tax professional if you have UTMA/UGMA custodian accounts to avoid the new “kiddie tax”.

You have about 10 weeks to go before year’s end, so it’s time to get moving! The human gift of free will is both a blessing and a curse, but as my planning partners remind me, we have to try. And if you don’t, who will?

Mark Daly, CIMA®
Partner
Perpetua Group
101 S. Capitol Boulevard
6th Floor, Suite 610
Boise ID 83702
208-333-1433
mark@theperpetuagroup.com

Wells Fargo Advisors did not assist in the preparation of this article, and its accuracy and completeness are not guaranteed. The opinions expressed in this report are those of Mark Daly and are not necessarily those of Wells Fargo Advisors or its affiliates.

Investment products and services are offered through Wells Fargo Advisors Financial Network, LLC (WFAFN), Member SIPC. Perpetua Group is a separate entity from WFAFN.

Wells Fargo Advisors Financial Network or its affiliates are not legal or tax advisors.

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September 2018

Consider a 2nd Act in Finance

Experience, wisdom, and a few gray hairs can offer tremendous advantages in the financial services industry. Potential clients in mid – to later life appreciate a broad range of experiences when it comes to managing their money. And that is to the benefit of people starting a second career – younger adults in their twenties and early thirties typically have not enjoyed that breadth and depth of life’s experiences.

Anyone seeking a career change or midlife diversion should at least consider the financial industry. Direct experience like accounting, finance or economics transfer easily. Athletics, politics and acting often translate well thanks to professional networking, resulting in a list of future qualified prospects.

If you’re thinking about making the leap into a new, second-half career in the financial services industry, give some thought to the following.

Invest in yourself. Certifications and credentials can be a door opener for those willing to invest in themselves. Recognized industry standards include Certified Financial Planner, Chartered Financial Analyst, Certified Investment Management Analyst, and Financial Para-Planner Qualified Professional. All require some level of additional education, testing, and technical preparation.

Find a mentor. A mentor can increase your odds of success. By joining an established team or group, you may be matched with an accomplished advisor to help you succeed. Success usually occurs between years 3 and 5.

Have a cushion. A safety net will support your career while you learn the business and establish a clientele. You may experience a temporary decline in pay, but the industry tends to pay above average compensation and benefits. Besides, you would never advise clients to save and invest without doing so yourself, right?

Get ready to work. Once you’ve decided to make the switch, be ready for the hard work that follows. Information overload and overcoming the fear of client prospecting can be intimidating, but that’s where your experience and self-confidence come into play.

Your previous knowledge and experience can afford you a distinct advantage. Managing someone’s personal finances is a daunting task, but doing it well provides stability and peace of mind. Planning, saving, and frugal spending helps those inclined to seek advice for a securely funded retirement.

The “Fortune 40”, the name of my original brokerage training class, is now whittled down to 2! It’s been a difficult career at times, but the satisfaction of helping others gain financial independence is deeply satisfying. If you have what it takes, a midlife change to financial services could be your ticket!

Mark Daly, CIMA®
Partner
Perpetua Group
101 S. Capitol Boulevard
6th Floor, Suite 610
Boise ID 83702
208-333-1433
mark@theperpetuagroup.com

Wells Fargo Advisors did not assist in the preparation of this article, and its accuracy and completeness are not guaranteed. The opinions expressed in this report are those of Mark Daly and are not necessarily those of Wells Fargo Advisors or its affiliates.

Investment products and services are offered through Wells Fargo Advisors Financial Network, LLC (WFAFN), Member SIPC. Perpetua Group is a separate entity from WFAFN.

Wells Fargo Advisors Financial Network or its affiliates are not legal or tax advisors.

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August 2018

Is Tech Worth the Risk?

According to a recent Wall Street Journal article, certain high growth technology stocks are up in price more than 50% in 2018. Compare that to the S & P 500 Index which is up about 6.5%. Should you move in the direction of a high octane stock portfolio, and dump your stable, diversified investments?

The technology sector continues to deliver staggering annual growth, especially for its enormous size. Is there any price investors won’t pay for these companies? Apparently not: The group sports a trailing price earnings ratio of over 100 according to Reuters. By comparison, the S & P 500 trades around 16 times earnings. Old school GARP (growth at a reasonable price) has given way to GAAP (growth at any price) in the example of large company technology stocks.

Lest we all get too carried away, our firm would not speculate on a sector strategy, regardless how attractive its prospects. Many of us own these companies in an index fund like the S & P 500, but we believe it should be in a quantity that goes against one’s risk tolerance should the price drop drastically or suddenly. And if the momentum-driven investor turns tail and runs - or the group fails to deliver on lofty future growth expectations, what then?

Growth companies continue to outperform value companies by nearly 13% this year, but we believe you should keep value companies in your portfolio should investor preferences change unexpectedly. Value companies have historically been less expensive, pay higher dividends, and the trade is less “crowded”.

Markets are fickle, and perceptions about large company technology stocks could be fleeting. Regulators, especially in Europe, will eventually have the last word on their dominant business practices, despite the argument that lower prices benefit consumers. Fewer competitors could eventually lead to higher prices due to fewer competitors.

We get a little nervous when we see a narrow, select group of companies carrying most of the performance load. While tempting, investor preferences for these stocks can change at any time when momentum shifts.

Our firm is willing to trade short term performance for stability of diversification, and the potential to limit downside losses during the next market correction.

We continue to believe the path to lasting prosperity is a straight one, and there is no free lunch. Gorging on large technology companies could eventually lead to serious setbacks, no matter how tempting the feast looks today!

Mark Daly, CIMA®
Partner
Perpetua Group
101 S. Capitol Boulevard
6th Floor, Suite 610
Boise ID 83702
208-333-1433
mark@theperpetuagroup.com

Wells Fargo Advisors did not assist in the preparation of this article, and its accuracy and completeness are not guaranteed. The opinions expressed in this report are those of Mark Daly and are not necessarily those of Wells Fargo Advisors or its affiliates.

Investment products and services are offered through Wells Fargo Advisors Financial Network, LLC (WFAFN), Member SIPC. Perpetua Group is a separate entity from WFAFN.

Wells Fargo Advisors Financial Network or its affiliates are not legal or tax advisors.

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July 2018

Economic Data Remain Strong

What is the yield curve? According to a recent New York Times (NYT) article by Matt Phillips, it’s “a powerful signal of recession” and “has Wall Street’s attention.”

Hyperbolic nonsense or useful predictor of the future? Let’s take a closer look.

The NYT article accurately defines the yield curve as the difference between short-term interest rates, like a six-month Treasury bill, and long-term rates, like a 30-year Treasury bond. The slope of the curve reveals clues about the health of the economy, interest rate policy at the Federal Reserve Bank, and bond investors’ expectations for future inflation and economic growth.

The article states “the so-called yield curve is perilously close to predicting a recession and it’s become a big topic on Wall Street.” As a close follower of the financial press, numerous periodicals, and research reports on fixed-income markets, that’s news to me. Economic data remain strong by nearly every measure.

The yield curve is positive, meaning short-term interest rates remain lower than long-term interest rates. This is called a “normal” curve that travels up and to the right when you see it depicted on a graph. Granted, the curve right now is very “flat” with smaller than average differences in yield between short- and long-term interest rates.

This could be explained by low expectations for future economic growth of the U.S economy, low expectations for future inflation, or small increases in consumer prices. Rates remain very low in Europe when comparing the U.S. Prime Rate of about 5 percent versus the London Interbank or Libor of around 2.3 percent, or Eurobor of -0.3 percent.

Bond indexes are generally down in 2018 year to date, and we may see negative returns on bonds for the first time since 1982.

The U.S. consumer and U.S. government continue to feast on low-cost debt, hitting new records of $13 trillion and $21 trillion respectively. The Fed finally achieved its stated goal of 2 percent inflation, but will be watching closely for an overheated economy and more potential rate increases this year and next.

Sensational headlines in the New York Times certainly grab your attention — or, worse, cause you to throw out your long-term planning in response to the dreaded inverted yield curve, which you now know means higher short-term rates. But fear not, faithful reader! The economic data do not support this thesis — at least not yet.

Mark Daly, CIMA®
Partner
Perpetua Group
101 S. Capitol Boulevard
6th Floor, Suite 610
Boise ID 83702
208-333-1433
mark@theperpetuagroup.com

Wells Fargo Advisors did not assist in the preparation of this article, and its accuracy and completeness are not guaranteed. The opinions expressed in this report are those of Mark Daly and are not necessarily those of Wells Fargo Advisors or its affiliates.

Investment products and services are offered through Wells Fargo Advisors Financial Network, LLC (WFAFN), Member SIPC. Perpetua Group is a separate entity from WFAFN.

Wells Fargo Advisors Financial Network or its affiliates are not legal or tax advisors.

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June 2018

Building Your Financial House

We know that home construction requires a floor plan and drawings. It gives us an idea what the final product will look like. More important it provides an idea of what the house will live like, and since we plan to live there, and may spend a small fortune building it, we want to get it right.

Our house building analogy translates well to investment and retirement building. Many of the same principles apply, so let’s examine 7 common themes.

Have details before you start building. Successful investing begins with a written plan. Your odds of success increase when you measure basic goals like expected return, time to retirement, risk assessment, inflation, and spending.

Higher the right people. Licensed architects, general contractors and engineers can be counted on to deliver the final product, structurally sound and on budget. Financial planners, accountants, and estate attorneys will coordinate their efforts on your behalf to help you reach your financial goals.

Set reasonable expectations for the finished product. True investing takes time, patience and perseverance.

Resale value. If you must sell make sure you’re prepared for immediate liquidity needs. We recommend clients reserve 5 to 7 years of annual spending in cash equivalents or short term bonds.

Affordable mortgage. Avoid excess debt and leverage, in home buying and investing. A house you can’t afford limits your lifestyle, while margin debt and over leverage may result in permanent loss of capital.

Don’t sacrifice amenities. Hiring a full service advisor may result in higher fees than do it yourself models. But a Financial Advisor can provide the advice and guidance you need to focus on goal setting and success measurement, while navigating life’s financial challenges and opportunities.

Check the work. Ask questions, understand what investments you own, and why you own them. What will the financial house look like upon completion, and will it meet your goals in the time you have available.

Your dream home, like the solid financial house, won’t solve all your problems, repair relationships, or solve financial difficulties. Its purpose is to provide a place to live, enjoy your family, and produce a growing asset over time. Your financial house should provide no less.

Mark Daly, CIMA®
Partner
Perpetua Group
101 S. Capitol Boulevard
6th Floor, Suite 610
Boise ID 83702
208-333-1433
mark@theperpetuagroup.com

Wells Fargo Advisors did not assist in the preparation of this article, and its accuracy and completeness are not guaranteed. The opinions expressed in this report are those of Mark Daly and are not necessarily those of Wells Fargo Advisors or its affiliates.

Investment products and services are offered through Wells Fargo Advisors Financial Network, LLC (WFAFN), Member SIPC. Perpetua Group is a separate entity from WFAFN.

Wells Fargo Advisors Financial Network or its affiliates are not legal or tax advisors.

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May 2018

Hats Off to Alzheimers Association

Imagine this: Every day when you arrive at work, you realize nearly 6 million Americans are affected by it. The number is expected to grow to 14 million by the year 2050. Two-thirds of those affected are women; people of Hispanic or African descent are 1.5 to two times more likely to have it. The vital signs of most patients are strong, but the vibrant individuals you know begin to slip away.

There is no known cure despite many years of effort and billions of research dollars spent. Most clinical information is gathered post-mortem. You can observe the symptoms, but are helpless to do anything about it. You and your colleagues spend hundreds of hours per year hitting Idaho roads, telling a story of hope, tempered by a stark reality.

That’s what it’s like to work for the Alzheimer’s Association: Greater Idaho Chapter. The Alzheimer’s Association has a singular vision — a world without Alzheimer’s disease. Since 1980, this organization has worked tirelessly in the areas of caregiving, research and support. They are driven forward by the hope that one day their vision of prevention and treatment of dementia and diseases of the brain will be realized. Look no further than our local chapter to find a Valley leader and shaper.

Kimberly Jaques, CFP, and I had the honor of presenting our ideas to a gathering of about 100 people at Saint Alphonsus in late April to discuss financial and legal planning for families affected by Alzheimer’s. Elder law attorney David Wilson of the Ahrens-DeAngeli Law Group joined us.

Together, we explored ways to reduce emotional stress and provided planning ideas for caregivers affected by this dreaded disease. Data clearly show that early diagnosis and treatment can drastically reduce the cost of care. Assembling your all-star team of qualified professionals in healthcare, financial and legal planning alleviates some of the stress, and frees up more time to care for your loved one.

Caregivers, comprised mostly friends, family members and volunteers, make up the majority of those willing to help. Careful planning can alleviate some of the financial and emotional stress suffered by the caregiver. The financial wherewithal to pay for treatment is critical.

Early diagnosis enables individuals to prepare legal, financial and end-of-life plans while they are cognitively able to make decisions and share their wishes with loved ones. If you saw the “60 Minutes” segment on this disease that aired April 22, you can see firsthand the progression of Alzheimer’s, and the emotional and financial toll on the caregiver.

Leadership is difficult. Running a successful nonprofit corporation is challenging. Waiting for prevention and cure is exhausting. Informing, educating and helping those afflicted in the meantime is a true measure of leadership. We tip our hats to the Alzheimer’s Association: Greater Idaho Chapter.

Mark Daly, CIMA®
Partner
Perpetua Group
101 S. Capitol Boulevard
6th Floor, Suite 610
Boise ID 83702
208-333-1433
mark@theperpetuagroup.com

Wells Fargo Advisors did not assist in the preparation of this article, and its accuracy and completeness are not guaranteed. The opinions expressed in this report are those of Mark Daly and are not necessarily those of Wells Fargo Advisors or its affiliates.

Investment products and services are offered through Wells Fargo Advisors Financial Network, LLC (WFAFN), Member SIPC. Perpetua Group is a separate entity from WFAFN.

Wells Fargo Advisors Financial Network or its affiliates are not legal or tax advisors.

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March 2018

2018 Health Savings Accounts

Health Savings Accounts survived the Tax Reduction Act of 2017 relatively unscathed, and the maximum HSA contribution went up. This year, singles may contribute $3,450 and families $6,900. Individuals 55 years and older may contribute an extra $1,000 "catch up" amount, and many employers offer this option through a cafeteria plan, whereby pre-tax benefits are selected ala carte, and paid before tax withholding, at the employee's discretion.

The deadline for 2017 contributions is tax the filing deadline, April 17, 2018 this year, or, if you extend, the filing extension deadline. A separate tax form is required, so check with your tax professional to receive the deduction. Contributions must be made in cash.

Qualified distributions are generally income tax free if used to pay for the account holder's qualified medical expenses, or a spouse or dependent.

Qualified medical expenses are broadly defined and include medical diagnosis and treatment, long-term care services, prescription drugs, and select health insurance premiums.

Some banks offer health savings accounts, but other options include Optum Health and HealthEquity. These companies specialize in health savings accounts, and are leading sponsors in the United States.

HSA contributions are an "above the line" deduction for federal income tax purposes. Qualified withdrawals are tax free. See IRS publication 969 for more information.

HSA accounts are a great way to save taxes, fund medical expenses, and you own the account balance. Contributions may exceed your earned income, you may contribute on behalf of another family member, and balances carry forward year after year.

You must be enrolled in an HSA qualified health plan with high deductible payments. You cannot be claimed on another person's health plan, and can't be claimed as a dependent on another person's tax return.

Consider getting started today, and explore the tax friendly benefits of Health Savings Accounts!

Mark Daly, CIMA®
Partner
Perpetua Group
101 S. Capitol Boulevard
6th Floor, Suite 610
Boise ID 83702
208-333-1433
mark@theperpetuagroup.com

Wells Fargo Advisors did not assist in the preparation of this article, and its accuracy and completeness are not guaranteed. The opinions expressed in this report are those of Mark Daly and are not necessarily those of Wells Fargo Advisors or its affiliates.

Investment products and services are offered through Wells Fargo Advisors Financial Network, LLC (WFAFN), Member SIPC. Perpetua Group is a separate entity from WFAFN.

Wells Fargo Advisors Financial Network or its affiliates are not legal or tax advisors.

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March 2018

States Will Eventually Solve the Healthcare Puzzle

To my detriment, I looked at the national debt clock (U.S. Debt Clock.Org) again. We discussed this remarkable real time chronometer last summer as the national debt was approaching $20 trillion, and it looks on pace to surpass $21 trillion this summer. The big round number was greeted with a yawn, and Congress wasted no time in passing more legislation that will increase our debt in the future.

Many ideas to increase healthcare coverage for Americans have been greeted warmly, including expansion of Medicaid, Medicare for All, and European-style single payer systems.

I'm having a hard time reconciling these well intended proposals with the U.S. Debt Clock, which in addition to the mounting national debt, clearly shows future Medicare liabilities of nearly $28 trillion, 57 million current Medicare enrollees, and 75 million current Medicaid recipients. 39 million Americans live in poverty, 41 million collect food stamps, and 27.5 million are without health insurance. The total number receiving some benefits is 165 million, or about one half of the U.S. population.

Lest you become despondent about healthcare and insurance costs, three states are leading the charge to help solve the problem. In February Gov. Otter directed the Idaho Department of Insurance to explore lower cost health plans. Blue Cross of Idaho wasted no time in launching "Freedom Blue" with monthly premiums as low as $200 per month for a healthy 45 year old.

Last fall Minnesota introduced a program known as "reinsurance" which spreads claims risk across several insurers. State officials predict 2018 premiums could be 20% lower as a result. Tom Price, Secretary of Health and Human Services, said the Trump administration is open to state initiatives.

Alaska, an expensive state for healthcare, received the O.K last summer for reinsurance. It pays for high cost events like cancer treatment, HIV and AIDS. Recall that Idaho's high risk pool worked quite well until it was taken out by the Affordable Care Act.

I'm not against some basic universal primary coverage for everyone, especially checkups and preventative care. Asking the federal government to carry the entire load, when current future liabilities are tabulated, will be next to impossible, so forget it – it's not going to happen.

Let's allow the States, long recognized by the Founders for incubation of fresh ideas and solutions, to work out health care for the uninsured and underinsured. Sometimes local decision making by local people is the best solution, so let's give it a try shall we?

Mark Daly, CIMA®
Partner
Perpetua Group
101 S. Capitol Boulevard
6th Floor, Suite 610
Boise ID 83702
208-333-1433
mark@theperpetuagroup.com

Wells Fargo Advisors did not assist in the preparation of this article, and its accuracy and completeness are not guaranteed. The opinions expressed in this report are those of Mark Daly and are not necessarily those of Wells Fargo Advisors or its affiliates.

Investment products and services are offered through Wells Fargo Advisors Financial Network, LLC (WFAFN), Member SIPC. Perpetua Group is a separate entity from WFAFN.

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February 2018

Bitcoin: The New Modern Currency

Was Bitcoin designed to make commodity futures and speculative stock options look like conservative investments? You might gather this from recent headlines and news reports about wild fluctuations in the price of Bitcoin since December. Is this relatively new digital currency worth the rollercoaster ride?

Bitcoin advocates say yes. They suggest the digital currency will replace traditional money, and this may eventually happen, but in the meantime, as with any revolutionary idea, there will be bumps in the road.

The oldest rare coin was minted in Turkey over 2600 years ago. This "medium of exchange" eliminated "barter" or direct exchange of goods and services. This reliable system has been the standard for several millennia.

Bitcoin, on the other hand, is a peer-to-peer system that was invented less than 10 years ago; instead of coins or paper money, Bitcoin is entirely digital. Digital coins, known as cryptocurrencies, are not backed by central banks or governmental agencies, thus adding to their allure, and potentially the nefarious.

With minimal centralized regulatory monitoring, digital currencies may experience big swings in value over short time periods. Bitcoin reached a peak price of $20,000 in December, and now trades just above $7000. A retailer who works on slim profit margins is unlikely to accept Bitcoin if their modest profit could be erased in a day's trading. While a few Fortune 500 companies accept Bitcoin, it is mostly traded between other Bitcoin enthusiasts.

Facebook recently banned advertising of financial products that promote misleading or deceptive advertising. Bank of America blocked clients from trading Bitcoin. Governmental regulators have shown a keen interest, including central banks like the Fed, and taxing authorities like the IRS. Bitcoin transactions are private, and therefore hard to tax and regulate.

The most promising use of this new technology is "block chain", the digital record of each cryptocurrency transaction; it cannot be changed or deleted. Blockchain can be used to record and document real estate transactions, not only in the U.S. but developing countries struggling with private property rights.

Most new ideas experience a speculative phase before moving to the mainstream, and digital currency is no different. Early adopters assume the greatest risk, and potential reward. Consumers should be careful and do their homework. If you don't understand it, don't invest.

Free markets and an unregulated internet will ultimately decide the efficacy of Bitcoin, but if you choose to participate, buckle your seatbelt and hang on!

Mark Daly, CIMA®
Managing Director - Investment Officer
Daly & Vachek Investment Consulting Group
Of Wells Fargo Advisors
101 S. Capitol Boulevard
6th Floor, Suite 610
Boise ID 83702
mark@theperpetuagroup.com

Wells Fargo Advisors did not assist in the preparation of this article, and its accuracy and completeness are not guaranteed. The opinions expressed in this report are those of Mark Daly and are not necessarily those of Wells Fargo Advisors or its affiliates.

Investment products and services are offered through Wells Fargo Advisors Financial Network, LLC (WFAFN), Member SIPC. Perpetua Group is a separate entity from WFAFN.

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January 2018

Will Congress Rein in the Fed

In "The Myth of Independence: How Congress Governs the Federal Reserve" — a must-read for all Fed watchers — authors Sarah Binder and Mark Spindel argue that Congressional lawmakers perpetuate a never-ending cycle of crisis and reform. They create banking laws in response to a crisis, then criticize Fed policy, then ultimately reform the Federal Reserve Act. (The Federal Reserve Act created central banking in the United States in 1913 after two previous failed attempts.)

It's a non-virtuous circle of events, the authors write, perpetuated by politicians who want to maintain their power and offer quick fixes to do so. Could 2018 be a major year in the cycle of crisis and reform? As long as the Fed delivers on its mandate of consistent economic growth, stable prices, and full employment, Congress and the president generally ignore monetary policy. This year we may see a confluence of events that shake their complacency.

One has to wonder how much of the recent economic recovery can be attributed to such a long period of low interest rates and low inflation.

The one-quarter percent increase by the Federal Reserve in December will likely be followed by several more increases in 2018 and 2019. That's good news for savers, but higher rates will also influence commercial and residential mortgages, credit cards, consumer loans, adjustable loans, business borrowing and bond prices.

The president will fill two vacant positions on the Board of Governors in 2018, plus two more by the end of 2020. Congress just passed expansionary fiscal policy through the tax reform bill. Fed balance sheet reductions that began in October 2017 could dump up to $50 billion of U.S. Treasury bonds and mortgage backed securities on the bond market every month. Lighter regulations may lead to 3-4% higher GDP growth, plus higher deficit spending to support new infrastructure construction. All these policies combined might lead to unexpected higher inflation!

Since 2008, the Fed has become the only game in town by providing unprecedented-- nearly unlimited--monetary stimulus in response to the Great Recession. With the election less than one year away, and one-party control of the legislative and executive branches, what will Congress do to reign in Fed power?

If history is any guide, the answer is little or nothing—not until the next crisis causes a rewrite of banking laws as the president and lawmakers attempt to wrest more control of regulations and monetary policy from the Fed.

Mark Daly, CIMA®
Managing Director - Investment Officer
Daly & Vachek Investment Consulting Group
Of Wells Fargo Advisors
101 S. Capitol Boulevard
6th Floor, Suite 610
Boise ID 83702
mark@theperpetuagroup.com

Wells Fargo Advisors did not assist in the preparation of this article, and its accuracy and completeness are not guaranteed. The opinions expressed in this report are those of Mark Daly and are not necessarily those of Wells Fargo Advisors or its affiliates.

Investment products and services are offered through Wells Fargo Advisors Financial Network, LLC (WFAFN), Member SIPC. Perpetua Group is a separate entity from WFAFN.

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December 2017

Should Collectibles Be Part of Your Strategy?

Antiques Roadshow on PBS is one my favorite programs. It's shown regularly on Idaho Public Television, and averages 8 to 10 million viewers per week nationally, making it the most popular program on the network!

Why the great interest in other people's stuff? First, it's fun to see the owner's reaction to the estimated valuation. You might actually see guests you know if you catch the first Boise edition that aired back in early 2014. Boise is so awesome they made three complete shows after taping- the Egyptian Theater, Idaho Penitentiary and Boise Art Museum.

Antiques Roadshow will revisit a former item and "look back" at how prices have appreciated – or not – from the original estimate. Don't be surprised by the crazy items that people show up with, usually shown at the end with enthusiastic but disappointed owners!

Stamps, coins, antique vases, rare ink pens, jewelry, art, and even vinyl records are just a few examples of the types of items people collect. The collection's value will depend on the quantity and condition of the items, and of course a willing buyer ready to exchange cash for the items.

Collectibles will incur different risks, including the risk of theft, so having a rider on your homeowner's insurance policy might be a good idea. Make sure you insure for least the fair market value, plus price appreciation and inflation. Roughly half of collectors have never obtained a professional appraisal

Many collectors rent an oversize safe deposit box at the bank. The cost is reasonable, and you may be able to deduct the annual box rental fee if you itemize deductions.

Storage can be an issue depending on the size and quantity of your items: You'll need a secure area in your home to safeguard your collection. Firearms come to mind due to added safety concerns. Safes can be a good option, but a talented thief can open them given proper tools and time.

Collectibles can be fun and exciting, but willing buyers at a fair price can be difficult to find. The value of specific items can be very subjective and can potentially be difficult to sell. Many people inherit rare antiques with no intention of selling. The pleasure is gained from passing them on to the next generation and showing them off on Antiques Roadshow.

Mark Daly, CIMA®
Managing Director - Investment Officer
Daly & Vachek Investment Consulting Group
Of Wells Fargo Advisors
101 S. Capitol Boulevard
6th Floor, Suite 610
Boise ID 83702
www.dvicg.com

Wells Fargo Advisors did not assist in the preparation of this article, and its accuracy and completeness are not guaranteed. The opinions expressed in this report are those of Mark Daly and are not necessarily those of Wells Fargo Advisors or its affiliates.

Insurance products are offered through our affiliated nonbank insurance agencies

Wells Fargo Advisors is not a legal or tax advisor.

Wells Fargo Advisors is a trade name used by Wells Fargo Clearing Services, LLC. Member SIPC

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November 2017

Keep Tabs on Titles & Designations

A Few Simple Changes Could Save Your Loved Ones Major Headaches

We're well into the fourth quarter, and as the weather gets colder it's time to take stock and some much-needed financial housekeeping. A few simple steps and phone calls could help you get your house in order - and more importantly, stave off some hassles for your loved ones should something happen to you.

Check Your Account Titles

Idaho is a community property state, which means that married couples share assets and property equally. In 2015, a new account registration became available in Idaho to avoid confusion about the cost, or tax basis, of an asset when the first spouse dies.

Community Property with Rights of Survivorship (CPWROS) is beginning to replace the standard Joint Tenants with Rights of Survivorship (JTWROS) as the account title of choice for married couples. CPWROS allows a tax basis upward adjustment of 100 percent of the assets and property held in a marriage upon the death of the first spouse. A higher tax basis may mean fewer capital gains taxes when the asset is sold.

Check with your tax advisor and legal counsel to determine if a CPWROS is right for you - in many cases, only a simple form and signatures are required to switch the title.

Check Your Designations

Now is a great time to make sure your beneficiary designations are current and up to date. Accounts that commonly have beneficiaries include retirement plans, life insurance policies, and employee stock plans. Correct designations will prevent assets from passing to an ex-spouse or deceased relative.

Consider Other Options

Finally, a word about Transfer on Death (TOD) and Pay on Death (POD) accounts. These accounts offer an inexpensive and convenient way to transfer assets to another individual, but they are very limited in scope and are no substitute for a will or living trust. Consult with your legal counsel and financial advisor to determine which options are right for you and your family.

Financial stewardship involves some planning, work and ongoing monitoring to avoid unintended consequences. The correct account registrations and beneficiary designations will create a harmonious balance that will keep your money working harder, both now and after you're gone.

Mark Daly, CIMA®
Partner
Perpetua Group
101 S. Capitol Boulevard
6th Floor, Suite 610
Boise ID 83702
208-333-1433 mark@theperpetuagroup.com

Wells Fargo Advisors did not assist in the preparation of this article, and its accuracy and completeness are not guaranteed. The opinions expressed in this report are those of Mark Daly and are not necessarily those of Wells Fargo Advisors or its affiliates.

Investment products and services are offered through Wells Fargo Advisors Financial Network, LLC (WFAFN), Member SIPC. Perpetua Group is a separate entity from WFAFN.

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