1 | Week In Review

Will Earnings Season Reflect Impact Of Monster CPI & PPI?

The markets closed higher on Friday, but the week was roiled by historically high CPI and PPI reports. Still, some sectors revealed upbeat earnings reports. Will earnings guidance reflect a slowdown? Annex Wealth Management’s Derek Felske and Danny Clayton discuss.

2 | Poll

Required Minimum Distributions: Common Questions: How Do I Calculate The RMD?

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3 | Client Exclusive

TD Ameritrade – keep your e-delivery preferences!

If you have an account at TD Ameritrade you have likely received communication from them to validate and maintain your existing electronic delivery preferences (statements and confirmation) for your account/s. These communications from TD Ameritrade are valid and do require action by you.

Beginning with your July 2022 statement, TD Ameritrade will require you to establish and use a TD Ameritrade user ID and password to maintain your enrollment in electronic delivery of statements, confirmations and other communications.

To establish your online credentials, please visit www.AdvisorClient.com and have your account number ready. Select “Set up my profile” then “Get started”. TD Ameritrade will then verify your identify using the phone number provided when you opened the account. From there you will be prompted to create a user ID and password.

Please reference the letter and/or emails sent from TD Ameritrade on establishing your user ID and password and confirming your e-delivery preferences on their site. If this is not completed by July 22, 2022 TD Ameritrade will change your e-delivery preferences to paper. You can always change your statements back to e-delivery by following the instructions in the communications from TD Ameritrade.

Please contact your Wealth Manager or Client Service Manager for additional questions. Thank you!

4 | Did You Know?

Annex Wealth Management’s President and CEO, David Spano, CFP®, is an avid hunter and wildlife expert.

This past Monday, the DNR released their 2022 spring wildlife surveys. According to Dave, wildlife surveys share at least a few similarities with the stock market.

Recently, Dave contributed his expertise to a piece for the Milwaukee Journal Sentinel. Check out this article, written by Paul A. Smith, that looks at the results of spring game birds and explains how these wildlife surveys act similarly to the stock market.

Wildlife surveys share at least a few similarities with the stock market.

For example, it’s best not to focus too much on specific, recent data when trying to get a gauge of long-term strength and prospects.

At least, that’s what I’ve heard over the years from friends and trusted experts Dave Spano (certified financial planner) of Elm Grove and Taylor Finger (Department of Natural Resources game bird ecologist).

The 2022 DNR spring surveys for waterfowl, ring-necked pheasants and ruffed grouse lend credence to that philosophy.

The data for this year’s work, released Monday by the DNR, show a 6% increase in the state’s breeding duck population, a 12% increase in pheasant crowing counts and a 6% decline in ruffed grouse drumming.

The bigger picture, however, reveals the most important stories related to each survey.

For starters, waterfowl continue to be in very good shape in Wisconsin. The 2022 estimate of 591,762 ducks was not only up 6% from 2021 but, drum roll for emphasis please, was 34% above the long-term (49-year) mean.

The waterfowl survey is conducted by observers in the air, on boats and on land.

The conditions this spring were favorable, too, with all types of wetlands in Wisconsin (temporary, wet meadow, seasonal, semi-permanent and permanent, linear and non-linear) showing increases from 2021, according to the report.

Among duck species, mallards were up 3% year-over-year and 2% above the long-term mean, while blue-winged teal were up 9% and 22%, and wood ducks were down 8% year-over-year and 102% above the mean. Total other ducks (American wigeon, northern shoveler, ring-necked duck, etc.) were up 26% from 2021 and a whopping 139% over the long-term mean.

The state’s Canada goose population continues its long-term increase. The 2022 breeding survey found 180,340 geese, 3% higher than the previous year’s modeled estimate and 68% higher than the long- term (36-year) mean, according to the DNR.

In keeping with the value of the big picture: This year’s Canada goose estimate is the highest since the DNR began keeping the statewide estimate for the species in 1986.

The strength of the state’s Canada goose population is something you can take to the bank.

Finger said the overall breeding survey results point to a promising season this fall for Wisconsin waterfowl hunters.

While the 2022 crowing survey showed a 12% increase in pheasants, it was 17% lower than the five-year mean. And as pheasant hunters or wildlife watchers can attest, the number of ring-necks in Wisconsin is dramatically lower today than it was decades ago.

The data are obtained by listening for roosters crowing in spring on 83 established routes in 29 counties; surveyors record data over 6 minutes at each stop. The 2022 average was 0.47 pheasants per stop, according to the report.

The work is done only in better pheasant range in Wisconsin or the counts would be far lower.

Pheasant numbers remain highest in the northwestern portion of Wisconsin. The species decline in recent decades is attributed to habitat loss, including by changes in farming practices that leave less vegetation around edges of fields, and nest predators.

So while the 2022 pheasant counts are up, it wouldn’t be wise to assume the birds are in the midst of a rebound to abundances seen in the mid- or even late-1900s.

Among ruffed grouse, the 5% decrease in spring drumming isn’t alarming. In fact, it was expected and is somewhat reassuring: the species appears to be following its traditional 10-year population cycle.

The cycles usually peak in years ending in 9, 0 or 1, said Brian Dhuey, DNR wildlife surveys specialist, then decline over several years before increasing again.

“We’re likely going to see that abundance begin to wane in the coming years as we enter the ‘down phase’ of the cycle,” Dhuey said.

Grouse surveyors drive on specified routes in spring and listen for the drums of male grouse. During the mating ritual, the birds start by beating their wings slowly and then increase the tempo to create a deep, thumping sound. The display usually lasts 5 to 10 seconds during which the wings can beat approximately 50 times.

Surveyors recorded 1.03 drums per stop this year across 91 routes, with the northern region highest at 1.6 followed by the central (0.37) and the Driftless at 0.07.

Ruffed grouse also are challenged by changing habitat and ecological conditions. The DNR no longer surveys for the species, for example, in southeastern Wisconsin.

But in the northern region, home to the best grouse habitat, the species continues to do well.

Continuing the big picture theme, many in the waterfowl world are eagerly awaiting the 2022 North America breeding report by the U.S. Fish and Wildlife Service and Canadian Wildlife Service. Due to the coronavirus pandemic, the continental waterfowl survey has not been conducted since 2019.

Due to drought conditions in much of the prairie pothole region in recent years, there is concern that continental duck numbers will show a decline. There is also anxiety about the effects of the highly pathogenic avian influenza, which likely has killed hundreds of thousands of wild birds this year. It has hit waterfowl and raptors particularly hard.

We’ll wait and see. And as always, try to keep things in the proper perspective.

The DNR wildlife surveys can be viewed here.

Source: https://www.jsonline.com/story/sports/columnists/paul-smith/2022/07/14/dnr-assessments-show-waterfowl-and-pheasants-up-ruffed-grouse-down/10046297002/?gnt-cfr=1

5 | Ask Annex

Annex Wealth Management’s Sarah Kyle and Randy Winkler, CFP® answer several Ask Annex questions:

“Sarah, you mentioned you previously worked on a trading desk, Warren Buffett buys and holds. What is the percentage of investors who actually do that? When traders jump in and out of equities, doesn’t that create the volatility we’re experiencing?” – Tom

“Please settle an argument. My partner checks investment balances daily, if not more. I didn’t even open up my first quarter statements. What’s ideal?” – Alan

“Is there a preferred past performance metric when doing research on an investment, especially now. Obviously, not YTD, that’s year-to-date. Is life of fund better?” – Hector

“What’s the difference between risk and risk tolerance? I’m not sure I like either.” – Donna

“Is this a time to consider a Roth conversion with the market down?” – Dan

Do you have a question for Annex Wealth Management? Drop it here: annexwealth.com/ask

6 | Quote of the Week

7 | Annex Radio

Events & Webinars

Annex Wealth Management has always been committed to client growth and education. Planning and saving can be demanding. We’ve found that when our clients master key concepts, it often enhances working together to reach their goals. Because these are not sales presentations, our clients benefit from a truly informative experience.