1. 7 Insights for the Second Half of 2022
Paul Caylor, CDFA®, CFP®, CKA® | President & Wealth Advisor | July 5, 2022
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5. • This PE ratio uses next-twelve-month earnings estimates, an important indicator when earnings are
rising.
• This measure has improved as the market has corrected this year.
• Investors should exercise caution and properly diversify across asset classes, both in the U.S. and
globally.
6. • This chart shows the implied rates and number of hikes/cuts based on fed funds futures at future Fed
meetings.
• Fed funds futures are an important real-time gauge for what the market expects from the Fed.
• The Fed is expected to maintain its accelerated path of rate increases.
7. • Generating income from safe investments has been challenging since the global financial crisis.
• The Fed has kept rates low, putting additional pressure on the income generated by cash - e.g. CDs and
savings accounts.
• Adjusting for rising inflation, most savers are still losing significant purchasing power by holding cash.
8. • The significant outperformance of U.S. stocks may lead some investors to avoid other asset classes.
• There have been many historical periods when other asset classes outperformed. Diversification takes
advantage of these trends.
• With cheaper valuations and global growth, it may be best to not overlook other regions.
