Two presentations from the Sustainable, Responsible, Impact Investing Conference.
Economic Forcast
- Tax reform will produce more equity inequality
- Add $1.5 trillion to deficit
2017 actual | 2018 prediction | |
GDP | 2.1 | 2.6 |
Inflation | 1.3 | 2 |
Unemployment | 4.2 | 3.7 |
Fed Funds Rate | 1.25 | 2.3 |
Stock market returns | 14.3 | -5% to 5% |
Bond market returns | 3.1 | -2% to 2% |
- Savings is currently at a rate lower – the US needs wage increase
- Productivity growth – up 0.6% (low) – productivity is critical to increase wages
- Expect capital investment surge – difficulty finding workers, need productivity improvements
- Capex (measures capital expenditures)
- Uncertainty causes companies to put off large expenses
- Corporate profits – stagnant at a high level
- Oil price negative – that’s a positive for renewables
- Leading indicators – high
- Business cycle – positive
- Recession possibility in 2018 low – 15%
- Shiller Price/10 yr Earnings is at 13.12 – 10yr treasury is at 2.35%
- Could see correction – but a bear market is unlikely
- Downward pressure on CAPE ratio
- Price above earnings
- Emerging market spread also low
- NAFTA = since nafta trade up in Mexico and Canada – down in US
- Pension fund crisis – aging population
ADVOCACY AND IMPACT
- Ceres, investor network on climate risk, as you sow, cfp, cdp,
- Collaboration with SRI funds – can share advocacy with clients
- PPG – still had lead in their paint
- Cerner Corp – added best practices lobbying policy
- Fifth Third – resolution on lobbying leads to climate risk
- Systemic Change
- Need uniform reporting
- Adaption of intl human rights
- Increase board diversity
- Talk about shareholder advocacy resolutions with clients
- Can delegate proxies to a 3rd party
- 2018 focuses
- Board diversity – targeting nine companies that have 0 women on board
- Lobbying and political spending – no disclosure, concentration of lobbying on 50 companies
- Climate
- Renewable energy – energy efficiency
- Deforestation
- Financing climate change
- Work on growing renewable demand – joined RE100
2018 focuses
- Board diversity – targeting nine companies that have 0 women on board
- Lobbying and political spending – no disclosure, concentration of lobbying on 50 companies
- Climate
- Renewable energy – energy efficiency
- Deforestation
- Financing climate change
- Work on growing renewable demand – joined RE100
SOCIAL HSA
- 2018 – $3450 individual, $6700 family
- At 65 can not contribute
- Covered by high deductible health plan – $1350 ind, $2700 family
- HSA Qualified Expenses – deductibles, Dental, vision,
- Can shoebox receipts – save receipts from now for next 30 years – pay for all expenses at retirement (in future)
- 0.25% / year plus $45/year/account fixed expense
- Plus manager fee
- FPS Trust company is the custodian
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520-325-0769, bill@impactfinancialplanners.com impactfinancialplanners.com