Client Axiom | Vol 263
Markets Stay Hot As 10 Year Drops
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Meet The Axiom®’s Guest Editor: Jason Ganiere, CFP®
Hello, I’m Jason Ganiere, a Wealth Manager at Annex Wealth Management.
I have been with Annex since 2013 and specialize in working with government employees since I worked in municipal law enforcement for 27 years. I have a strong understanding of the unique planning needs of clients with government pension and benefits.
I have been married for over 20 years and my wife and I have two daughters and have been longtime New Berlin residents. We enjoy spending time with family and going Up North to ski, hike, ATV and just relax.
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“I enjoy the Axiom because it breaks down what can be complex financial planning topics into small bites of information which are easy to digest on a Sunday morning. I also appreciate that Annex always uses current events to highlight the topics which are covered in the Axiom.”
– Guest Editor: Jason Ganiere, CFP® | Wealth Manager
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Markets Stay Hot As 10 Year Drops
The Fed continued to demonstrate that it believes inflation is transitory – and the bond market may agree. The 10 year fell as markets continued to rise. Annex Wealth Management’s Mark Beck and Derek Felske discuss how the second half of the year may not perform the same as the first.
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Is Fine Dining in the Stars?
What a Michelin Star means and why it matters to you.
Few of us who live outside America’s largest cities could name a Michelin Star restaurant off the top of our heads. If you can, then it’s safe to say you’ve achieved “foodie” status. Or you watch a lot of Food Network.
“Michelin” can connotate one of two things: a quality tire for your vehicle, or an extraordinary meal prepared by a top-notch chef. Yes, this isn’t a coincidence.
The France-based Michelin company began publishing a travel guide for Europe in 1900 in order to encourage drivers to take road trips to local attractions, using Michelin tires, of course[1]. This guide included, among other things, anonymous restaurant reviews that rated both quality and style; and thus the Star was born.
A Michelin Star is the highest award that a restaurant can receive and represents not only exceptional food, but style, quality, and creativity. Though a popular guide in Europe for many decades, it was only in 2005 that Michelin started appearing in the United States, and even then, only in Chicago, New York City, Washinton DC, and San Francisco.
If you aren’t near any of those cities, you may want to plan an extra special trip to visit one, perhaps as part of a special culinary tour or as part of your bucket list to see just what they are about, and what makes them special.
When making your plans, consider making a reservation as early as you can, and note some restaurants even require a credit of up to 50% an average bill in order to hold your reservation.[2] It is also important to note that when you’ve finally booked your table, plan for up to 5 hours if you opt for the full tasting menu experience.
Part of why a Michelin Star restaurant stands above the rest is the attention to detail, the flow of each course, the thoughtful pairing of menu items, and the knowledge and consideration of the staff in providing you with a holistic dining atmosphere.
Though not typically standard, some restaurants even take guests on a tour of the kitchen during the course of the meal to fully immerse you in the experience.[3] These are just a few ways Michelin Star restaurants distinguish themselves and attract those who are seeking an elevated experience, and for those who were wondering, just like we were, here are a few things that the anonymous full-time restaurant reviewers look for. Sidenote: that might be the best job ever!
- Using quality ingredients (maybe this one is obvious)
- Mastery of flavor and technique
- Seeing the personality of the chef in the cuisine
- Value for money (yes, please!)
- Consistency in food
Now, if you think that cooking a meal for your in-laws when they visit is stressful, imagine trying to keep up with the small handful of recognized restaurants worldwide and the top tier critics that are constantly and anonymously judging every move you make! It’s no wonder that some chefs have actually rejected the prestigious Michelin award.
As it stands, there are only 14 Michelin 3-star restaurants in the U.S.[4] and most of them are in California, so it’s pretty easy to say the guide is extremely stingy in their selections and devote their time only to the largest culinary cities.
The stars can become an obsession for chefs (chef Gordon Ramsey actually cried when his New York restaurant was stripped of one[5]) and can be damaging to profits – and even the state of mind – of the chef under pressure.
Spanish chef Julio Biosca gave up the star he was surprised to earn, and claims he sleeps more soundly at night because of it, saying that though the award is high praise, “the problem is all that surrounds it: the eagerness to become number one, to step on others along the way. I was exhausted from the system and wanted to come back to the origins: having people leave my restaurant feeling happy.” [6]
Biosca and other chefs who have rejected the award were able to go back to their craft without the added pressure of what the Star means for their customers, their menu, and ultimately their bottom line. One chef even said that as a Michelin star destination, on food alone, they don’t make a profit![7]
Kind of sounds like a double-edged, expensive sword. But one that most chefs around the world would gladly yield for the prestige it brings. The name Michelin implies an extraordinary menu and experience, and it might be worth checking out for yourself once you can get those reservations booked, that is.
If you’re interested in learning more about the world of high class, Michelin Star-level dining, check out the Danish documentary called Michelin Stars: Tales from the Kitchen where you can see interviews with recipient chefs and kitchens about the process and their experiences while being in the Michelin Star limelight.[8]
Bon Appetit!
[1] https://www.ice.edu/blog/michelin-stars
[2] https://www.traverse-blog.com/beginner-guide-michelin-star-restaurants/
[3] https://www.traverse-blog.com/beginner-guide-michelin-star-restaurants/
[4] https://www.finedininglovers.com/article/how-many-3-star-michelin-restaurants-are-there-usa
[5] https://www.ice.edu/blog/michelin-stars
[6] https://www.pri.org/stories/2015-03-02/why-great-chefs-reject-michelin-stars
[7] https://www.pri.org/stories/2015-03-02/why-great-chefs-reject-michelin-stars
[8] http://povmagazine.com/articles/view/review-michelin-stars-tales-from-the-kitchen
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Poll Recap: Who Will Get To Space First? If You Were Given A Golden Ticket, Would You Join Them On Their Trip To Space?
Jeff Bezos and Richard Branson have at least two things in common – they’re both self-made billionaires, and they’re both using their billions to get to space.
Branson, owner of Virgin Records, Virgin Atlantic, and other ventures, launched Virgin Galactic in 2004. Bezos, founder of Amazon and the world’s wealthiest person, founded Blue Origin in 2000.
Suborbital Space Tourism
Both Blue Origin and Virgin Galactic have plans to transport tourists on short, suborbital flights to the edge of space, about 80 to 100 kilometers above the Earth, where they will experience a few minutes of weightlessness.
Bezo’s Blue Origin will use a rocket to launch passengers in its New Shepard capsule into space. Branson’s Virgin Galactic will transport passengers in a SpaceShipTwo suborbital spaceplane.
In our latest poll, we asked readers “Who will get to space first?” Between Bezos and Branson, the responses where almost split but readers slightly favored Branson’s Virgin Galactic at 53%.
Branson reaching space first might be a reality, as he recently announced Virgin Galactic will run a test spaceflight on July 11. That’s more than a week before Bezos plans to complete his own spaceflight.
We also asked readers “If you were given a golden ticket, would you join them on their trip to space?” – to which the majority of respondents answered no. Actually, most chose “No. Like a thousand million times no.” 17% answered “Yes, hand me the helmet now!”
Do you have $200,000 laying around? If so, you might be able to get your hands on a Virgin Galactic ticket, which Branson has already begun selling.
https://www.cnbc.com/2021/07/02/branson-vs-bezos-how-the-two-space-bound-billionaires-stack-up.html
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Do You Need An Estate Plan For Your Family Vacation Home?
Vacation properties are probably on your mind more than ever while you are in summer vacation mode. While you certainly enjoy them, there can be a few things to consider for the welfare of your property, your heirs, and your financial plan as you think about the future and the property you own.
Unlike financial assets such as bank or retirement accounts that can be easily divided among heirs, we often forget about real estate as needing to be co-owned among surviving family and the responsibilities that come with it. This can add complications, and it is important to get everyone on the same page sooner rather than later.
Estate Planning Attorney Jill Martin, JD gives a few insights on planning for your vacation property now and having conversations with your family to avoid any potential problems in the future.
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This week’s Ask Annex comes from Chris, who asks:
“What impact does inflation have on the US dollar?”
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We asked Annex Wealth Management’s Todd Voit, PhD:
Fluctuation in exchange rates, in this case the U.S. dollar, are primarily influenced by three things:
- Expected economic growth differentials
- Expected interest rates differential
- Expected inflation rate differentials
I emphasize the words “expected” and “differential” to make the point: It’s not about absolute levels of interest or inflation rates, it’s about the “rate”, the change in rates and the difference between two country’s “rates”.
If the U.S. economy is expected to experience slower growth relative to other countries, the dollar is expected to be weaker over the next year. If real interest rates are expected to fall relative to another country’s interest rate, the dollar is expected to be weaker. If U.S. inflation is expected to rise relative to other countries, the dollar is expected to be weaker, and the exchange rate adjusts accordingly.
So, more directly to the question, what impact does inflation have on the U.S. dollar? Short answer is higher inflation relative to other countries implies a weaker dollar. Depending on whether that’s true or not is a matter of someone’s opinion and ours is that we’re likely to see weakening in the U.S. dollar, however, between now and the of the year you will see a resurgence in the variance of COVID and likewise a stronger U.S. dollar.
A weaker dollar also implies higher inflation. Cause and effect cuts both ways – U.S. consumers have a fairly high propensity to consume imported goods so as foreign prices rise (because the dollar is weaker), domestic producers can raise prices and still remain competitive.
Let me know if you have any further questions.
Hope this helps.
Todd Voit, PhD
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KNOW THE DIFFERENCE MINUTE:
Summer Travel May Include Delays, Cancellations, & Higher Fares
KNOW THE DIFFERENCE MINUTE:
PTO Requests At An All-Time High This Year
ANNEX RADIO
Ladies, Stop Leaving Financial Planning To Your Husbands
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