September 30, 2023 | Food Stocks, Portfolio, Automobile Strike, Gold and Social Security & Medicare Changes

Food Stocks
I enjoy food quite a bit, but looking at food stocks I’m beginning to think I like them better. Food companies in 2023 are down between 15 to 25%, and these are levels that some have not seen in 10 years or longer. You know a lot of their names like Kellogg and Campbell Soup. They are not as exciting as tech companies, which have really helped the index rise this year, but with dividends at 3.5 to 5% I think investors should consider looking at these stable companies.

 

Portfolio
There is only one business day left in September and you may be concerned on where your portfolio stands for the month or maybe even year to date. I want to refresh people’s memory that September is historically the worst month of the year for investing and this September looks like it is holding true to the history. But based on what I’m seeing, this is setting the stage for a very strong fourth-quarter gain. We are seeing lower inflation, which means we are closer to stable interest rates and there are some very good values in equities. This is why investors who buy quality and stay the course do receive good long-term returns. If you have good quality equities, do not panic and sell out as I believe you will miss out on some very good future gains.

 

Automobile Strike
You may be thinking that the automobile strike from the UAW against Ford, General Motors, and Stellantis won’t affect you because you’re not in the market for a new car. Well, think again. The UAW President, Shawn Fain, is not just striking against the car manufacturers, but also is causing parts suppliers that don’t have large inventories to have a disruption in the supply chain of parts. What that could mean for you if you own a Ford, General Motors or Stellantis, is you could be turned away when you need repairs on your car like maybe brakes or a water pump. I still believe the union is being rather greedy with workers of the car manufacturers making between $65,000-$95,000 a year and asking for a 40% increase over the next four years along with other benefits, it just seems excessive to me. And who pays? the consumer.

 

Gold
I noticed today that gold is now down to $1848 per ounce and over the last six months has lost 5.7%. It looks like the high was reached this year on May 4 at $2049.73 which if you were unfortunate to buy that day that would be a loss of 9.8%. I bring this up because I know in the last six months or so I’ve received more inquiries about buying gold then I have in quite a while. I am steadfast with my recommendation this year, not to invest in gold I see no reason for it. Even with the government shut down we are looking at I see no reason to invest in gold in 2023.

 

Financial Planning: Social Security and Medicare changes in 2024
As we get closer to the end of the year, we are getting more information about the benefit and cost changes coming to Social Security and Medicare. Next year the expected increase for Social Security payments is 3.2%, which is quite a bit lower than the 8.7% COLA last year and the 5.9% COLA in 2022. For the average beneficiary receiving $1,792 per month, this increase results in $57. The annual increase is determined by the change in inflation from the third quarter of 2022 to the third quarter of 2023, so we won’t know the official change for a few more weeks. Last year we saw Medicare Part B premiums decrease from $170.10 to $164.90. However, in 2024 these premiums will be increasing again up to $174.80. This 6% increase is largely attributed to the cost of a new Alzheimer’s treatment coming out. Medicare Part D, Medicare Advantage, and Medicare Supplement premiums are expected to be mostly unchanged from their current levels. Overall, even though the benefit increase from Social Security will be relatively small, it will be enough to cover the increase in Medicare costs.