October 2023
Firstly, Jeff and Chris address the Israel-Hamas war and its potential impact on global markets. Jeff emphasizes the importance of diversification in building resilient portfolios to weather unforeseen events like this.
Last Thursday, we delved into the different funds and strategies that strengthen and diversify our clients’ portfolios at the Investor Symposium. Morton advisors, fund managers, and other external speakers discussed investment and financial planning topics like how to raise financially savvy kids, the possibilities and pitfalls of artificial intelligence, Bitcoin/cryptocurrency, and how to handle financial disagreements with one’s spouse.
To close the symposium, Jeff and Meghan Pinchuk, our Chief Investment Officer, announced our plans to form our own fund with the goal of democratizing investments and expanding access to diversification. Stay tuned for more updates on this process! We would like to thank everyone who attended the conference and hope the sessions were helpful to you.
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Watch previous episodes of THE FINANCIAL COMMUTE here:
Ep. 54 Navigating Financial Turbulence & Inflation with Gold
Ep. 53 Celebrating a Year of Financial Commute Insights: Join Us at the Investor Symposium
Hello, everybody, and thank you for joining us for another episode of THE FINANCIAL COMMUTE. I'm your host, Chris Galeski, joined by CEO of Morton Wealth, Jeff Sarti. Jeff, thanks for coming.
Happy to be here.
So we're going to recap our investor symposium that we had last week. I mean, it's our largest event of the year and it was focused a little bit differently this year between investments but also financial planning topics.
We had over 300 people attend. It was great. Packed house.
Right. We talked about a number of things and obviously there's some horrible stuff going on over in the Middle East right now. And it's just very unfortunate. It's causing some uncertainty and, you know, some concern for many people. And even though our markets seem to be somewhat resilient right now, this could turn into something larger, it's something that we have to keep our eyes on. I'm sure there's always uncertainty. But this one just sort of hits home, as you know, little bit differently.
Yeah, no, it really is obviously a horrible event and very sad concerning what's happening over there. And to your point on uncertainty, I mean, we don't know what the ensuing weeks hold as well. Those unknowns are always present. But now, bringing it back to what we do in terms of our role, in terms of investments in financial planning, something we talked a lot about.
Right. Just uncertainty in the markets and certainly in the world. Uncertainty is a constant to some degree. An event like this, as horrific as it is, again, you never know when these events can happen and what the ultimate outcomes will be. But it's one of the reasons why we are so focused on diversification. We don't know when these events are going to expose themselves.
And so but that being said, the one thing we can control is building resilient portfolios that, knock on wood, will be resilient in environments like this.
Yeah, and that was one of the biggest takeaways is that I think I had from the investment stage. You know, the majority of those topics were focused on the groups that we have that make loans that are backed by substantial assets to where if something were to go wrong, our clients or our investors are protected. They've got collateral behind that. So not only are they protected with the stuff that's behind the actual loans, but we're making sure that they're diverse amongst geography or asset class, whether it's real estate or loans to companies. And then, you know, make sure it's across the U.S. So that way, you know, a single event or something unique, you know, doesn't affect all of them.
Yeah, I think one of the biggest takeaways that all of our asset backed lenders mentioned was with the banking crisis earlier this year, it's just providing even more opportunity for them. Yeah. And not that they, you know, make these loans and want any companies or anybody to fail. Right. But what uncertainty allows for them is to look at five or ten times more opportunities than in a normal environment when everything's good.
So if they're looking at five or ten times more opportunities, they can be a lot more selective and a lot pickier. When it comes to the types of loans and collateral that they're making decisions on.
That was a general theme that was hit on across a number of our managers that given especially the banking crisis we had call it six or seven months ago, there's really a void in traditional lending. It's a real sweet spot. For now. Our private lenders, where we have a tremendous experience, where they're much more able to cherry pick really, really great loans that potentially didn't even come in their door six or seven months ago. So it's a really interesting opportunity for us in our partnership.
I just I'm blown away. I mean, we had, you know, eight or nine topics, both investment and financial planning.
I think it was you, might have been Meghan but one of you said that Lon just would have been really proud of this event and this mission that we have with finding investments that go against the traditional stocks and bonds and provide value and diversification.
Lon Morton, who formed Morton Wealth was an incredible man. He would have been really excited, passionate about what the firm has become. But specifically on this particular day, showcasing all of these wonderful managers on the investment stage and then the breadth of financial planning topics as well to help families, individuals navigate all the personal things they face in their life, both on the financial and even on the personal side.
It was just a great day where we really, really hit on a lot of topics that I think really made a difference in our clients’ lives.
Like, I'm going to clean up the investment stage there, that way we can talk about the planning stage with, I think, which is I think the area that surprised us all in terms of the conversations that our clients and CEOs and people that we had invited there took away from it.
They were blown away with the conversations, really thought provoking. But the investment stage, you know, obviously a lot around higher interest rates, inflation, and fears of a recession. A bank failure earlier this year. The issues in the in the crisis going on in the Middle East creating uncertainty. But, you know, all of those groups are focusing on ways that they can, you know, better protect investors, set them up for success in the future, and avoiding just those, you know, top two or three names that are providing all of the growth in the equity space too- one of the topics that was a big takeaway was the decoding of Bitcoin and the future of crypto.
We had Nik Bhatia and Brian Standing, who you've had on this podcast before. And you know, Nick talked about, you know, the relationship between Bitcoin and gold and gold being, you know, the predominant store of value and, you know, Bitcoin being something new and young, and we're not sure where the future is going to go, but it's been around for about 14 years now and it's something that everybody should be keeping an eye on, although we're not ready to hit the invest button just yet.
Yeah, it's it's something we are looking at and definitely spending a lot of time better understanding and it's something we've been doing for the last several years. That being said, at least in the current environment, gold is our choice as an alternative currency and a store of value for a variety of reasons that we've talked about in the past.
That being said, potentially there's room for both of them to exist and I think even likely room for both of those to exist. But definitely gold is our asset class of choice.
And there was a session with Sasan and Mike around that. I know from playing around with artificial intelligence or Chat GPT just in the last week.
It's a tremendous tool to help if you know what to ask it and be very specific. It's a tremendous tool to help sort of simplify some of your research and kind of formulate ideas and be creative. But it's still something that needs to be fact checked, double checked, and then, you know, reviewed by somebody else to make sure that the advice that we are given or what we're leveraging it for is impactful.
I know I've used it to write a couple LinkedIn threads, which I think that that's harmless because I'm not giving financial advice based off of it. But it, you know, with a couple of prompts, it probably took something that would normally take me 15 to 20 minutes, take less than a minute.
We are at the very early stages of this technology and it's already in incredibly powerful, the way it can harness data, in essence, and then with certain prompts and questions, create really interesting and unique outputs is very powerful.
And that's only even just on the you mentioned LinkedIn on the communication excuse me, communications front in terms of how it uses data in other areas. And I think one of the areas they particularly hit on was in their health care space, for example. So powerful, right? The ability to take data. This is how drug companies now invent new products.
It's through the use and synthesis of data to test things in an artificial environment. That's one of many examples where I can really accelerate technological advances so fast. A
Let's talk about the planning stages, biggest takeaways from from those session. Biggest takeaways. The the conversations were great across the board.
And one of the things I love so much about the conversations is that while some strategy and taxing tactics on the financial planning side were discussed, most of it was just around real life conversations, right? It was things around how to raise financially responsible kids and all of the things that we as parents struggle with. It was the current me versus future me, the current me wanting to enjoy life and spend on experiences versus the future. Me really thinking about retiring and saving for the future.
And one of the problems that our industry has and saying, you know, hey, if you want to be successful in the future, stop buying that Starbucks. Yes. And that's just not the way that the world works, right? I mean, the world is like, I want to have my Starbucks went out and I will still want to be successful in the future, too.
So the current me versus the future Me is sort of addressing the need for wanting to enjoy life and experiences today, but also make sure that you're making good decisions for the future as well.
And simple as that sounds right, those two opposing forces and these are something we deal with all day long, every day. You're weighing those two things, right? So we had a great conversation around that. Another one that I was personally involved with was the Sandwich Generation with Patrice, one of my colleagues, where we talk about navigating all of the responsibilities of raising kids, taking to them to and from soccer practice, carpooling, school, navigating, helping them get into college on the one hand, but then also helping our parents as they enter their golden years, retirement years, navigate all the issues around health, where they're going to live, support all of that.
So that was an engaging conversation as well. Yeah, I heard Patrice shared some really interesting stories of the challenges that she's faced. And you know, it's definitely a topic that people don't discuss that often, but it affects many of us.
I heard Battle of the Spouses financial edition was great.
It was great. And it was one of our colleagues, Beau, with his wife, Daniela, who were navigating all of the issues that married couples typically face. And we come to money from different places.
Yeah. And often that results in butting heads. And they just had great anecdotes, stories, but also two tools on how to navigate through some of those issues. But that was that was a great session. Was it something like their second or third date? And he started talking about budget?
Yeah, he started talking about talking about budgeting. And she decided he was worth continuing to move forward with instead of just cutting it out right there.
So I was impressed by Daniela on that one.
It's so fascinating. And then what's the opposite of a knight in shining armor?
That was the question. Yes. And her quick answer was a financial planner.
You know, in terms of money conversations with my wife, I'm so fortunate that, you know, she's as structured and as diligent as she is because she's always been very organized.
You know, lives or spends well within her means. Whereas I probably flew by the seat of my pants when I was younger and wasn't as diligent as she is. So I think if she was to bring up budgeting on the third date, I probably would not have got out a fourth one. I don't know.
But look how much you moved in her direction over time.
Another topic was, you know, planning tips for financial savvy kids. I think Kevin mentioned that as early as the age of two or three years old, you know, they start picking up on the relationship with money, you know, and starting to teach kids as early as two or three years old about money.
Yeah, I missed that session, but I heard him talking about this in the prep where and scientific studies have shown this, kids, even as young as you mention, as two or three, actually understand some real fundamental basics of money, of spending and saving, which is kind of shocking, right, when you're talking to one of your two little kids.
Yeah, you might not quite realize how much they understand, but they understand more than we realize.
I just know on Fridays at 4:00 when I take her to swim class. Yeah, she wants to get, you know, a little bag of that pirate's booty. And she's like, I don't understand. It's sitting right there. Just go get it and pay for it.
She just sees me swipe a card. Whereas when I think when I was younger. Yeah, our parents would give us, you know, a quarter or $0.50 or a dollar, and we were more closely connected with something tangible in the money. I missed that session as well because I was doing another session on the other stage. But I know I'm very excited that all of these were recorded.
Our marketing team is going to put them together and make them available to all of our clients and friends that we were able to participate and maybe missed a session, were not able to participate. So I'm really excited about the future of that.
Yeah, and each session was only 20 minutes too. So really nice bite bite sized pieces.
So it's great. We're going have a lot of content coming out of this.
I assume that we’ll, you know, load them up to the website or, you know, our YouTube channel. I know we may use a few of the sessions as episodes of THE FINANCIAL COMMUTE now, this podcast from time to time, so I can maybe take a take a vacation.
But closing remarks. You and Megan prior to coming going to the symposium, you spent a week in Boston, in New York, having final conversations with or addition or conversations with some potential new investments that you're exploring. Yeah. And then you're making that some closing remarks or takeaways with where Morgan Wealth is today and where we're trying to go with in the future.
Let's talk a little bit about that. Where do you see Morton Wealth going in terms of the investments and how we're helping empower better investors?
We are definitely not complacent and we're continuing to search for diversifying strategies that will continue to add value for our client portfolios. And you mentioned this earlier in our discussion.
It really is a sweet spot for us because so many traditional lenders are retrenching and not as involved that a lot of these niche lending strategies were able to be more targeted.
Yeah. And you're referring to the bank sort of closing up, getting gobbled up by the JP Morgans themselves. And that's just not the business that big banks are in.
And it's really small and medium sized banks that have these creative lending opportunities.
Exactly. So our private lenders are now really able to come in and many of these managers that we met with in niche spaces and charge higher interest rates than they were even just a few years ago. A lot of this at its core is, as you know, and you were looking to broaden this offering to more people.
One of the frustrations for Megan and myself and really for all of us are these really arbitrary rules imposed by the SEC. You have to have certain networks require requirements to invest in many of the strategies that we're so passionate about. So we are spending a lot of time and it's in the works. It's going to be coming in the next year or so.
We're going to form our own fund and go through a very lengthy and expensive process with the SEC to do just that, to help democratize a lot of these investments because it's through this structuring process, I won't bore you or the audience with all of these details, but it's through that structuring process we will be able to take a lot of these strategies that are only available for higher net worth investors and allow for lower net worth, more modest net worth investors to access.
As the world's more evolving access to information and insight is happening, any way that we can help clients get more access to things that truly diversify and help protect them.
Because the last couple of years have been evident that, you know, stocks and bonds are the diversifier that, you know, they weren't once were from a textbook stamp and investors need more, they just need more.
And obviously over the last decade or so, alternative access has really expanded. But we're just in the first inning of that. And with our experience, we could really lead the charge in terms of, again, providing more access to some of these really wonderful opportunities.
Jeff, thank you again for your mission to help empower better investors in democratizing investments and, you know, we're going to have these sessions that were recorded from our investor symposium, hopefully up on the website or given access to you here soon. Thank you for tuning in and I look forward to talking about other investments in future episodes.
Disclosure: Information presented herein is for discussion and illustrative purposes only. The views and opinions expressed by the speakers are as of the date of the recording and are subject to change. These views are not intended as a recommendation to buy or sell any securities, and should not be relied on as financial, tax or legal advice. You should consult with your financial, legal, and tax professionals before implementing any transactions and/or strategies concerning your finances.
