Jul 25, 2014 Update from Yale

Every year LPL’s Advisory leadership takes over one of the premier business schools in the country. Active professors take advisors through the cutting edge of finance in academia. It is the most worthwhile conference of the year for me. This year, the top 125 Advisory practices at LPL took over the Yale School of Management. I thought I would share highlights from three of the speakers from Yale.

We heard from Professor Fiona Scott Morton on Healthcare. She looks at the affordable care act as way to reorganize how we finance healthcare. She points out that currently healthcare spending is at 20% of GDP. Payment will now be based on a diagnosis instead of a list of billed procedures. This is going to lead to a massive change in how Doctors and Hospitals interact. She believes they are trying to incentivize “Health” instead of healthcare. From an investment standpoint, it is going to be a tough time for imaging and testing. Hospitals will become Cost centers instead of profit centers making strong Rehabilitation and skilled nursing centers more attractive. Device improvements will need to be game changes to lead to long term profits and surprise winners will include Information Technology and Consulting.

We also got the pleasure of hearing from Dr. Robert Shiller. He was fresh off receiving his Nobel Laureate in Economics for 2013. An honor that he shared with a past speaker at one of these events Dr. Eugene Fama as well as Lars Peter Hansen. While the work of Fama and Shiller has been fantastic, it is fascinating that both could win in the same year. Fama is a pioneer of Efficient Markets and Modern portfolio theory. As a behavioral finance economist, Shiller believes that markets are not rational. He successfully predicted the housing “bubble” of 2007. He looks at rising prices like an epidemic. Prices rise, until they don’t. My favorite quote from Dr Shiller when asked to make a prediction on where we are going now “I’d rather tell you about the fundamental uncertainty of it all”. Sounds like a politician to me.

Andrew Metrick, the Deputy Dean and Professor of Finance and Management also shared insight into the management of the $20.7Billion Dollar endowment. He also addressed some of the distinctions between managing massive institutional money and individual client funds. Many of the principles overlap. The endowment believes strongly in Equity. At their scale and scope, they have access to both public and private equity, but believe in the long term benefits of ownership. They look for diversification. With their long term horizons, they can also look into less efficient markets for investment opportunities. With all of the massive brain power at the business school, they also believe that they should look for outside managers for all but the most routine of investments. Finally the focus on aligning incentives between the endowment and the managers. They want to make sure that they are sitting on the same side of the table. Much in the way we work with our client accounts.

All In all, it was a fantastic conference. These meetings that we go to periodically through the year provide great material to keep us on the forefront of asset management and financial planning. Being with other top advisors provides an invaluable time to share ideas and focus on what is really important, our clients. With that in mind, I want to thank you for choosing Leonard Rickey Investment Advisors. If you have any questions or would like to discuss your accounts in greater detail, please don’t hesitate to call.

Company News

Employee Spotlight – Jacqueline Cremen

Shreds and Meds Day – October 28th at The Valley Mall

Employee Spotlight: Chelsie Smith

Employee Spotlight: Dirk Bernd

Congratulations, Gunnar!

Market Commentary

2023 4th Quarter Investment Commentary

2023 3rd Quarter Investment Commentary

2023 2nd Quarter Investment Commentary

Debt Ceiling: Should Investors Worry?

2023 1st Quarter Investment Commentary

Retirement Planning

2024 Key Financial Changes

Social Security Benefit Increase of 3.2% for 2024

The 4 Changes from SECURE Act 2.0 You Should Know for 2023

Medicare Open Enrollment for 2023 Begins October 15th

Social Security Benefit Increase of 8.7% for 2023

Tax Planning

2024 Key Financial Changes

2023 1099 Release Information

2023 Year-End Tax Planning

When do I start my Required Minimum Distribution?

UPDATE: Washington State Long Term Care Payroll Tax

Cyber Security

Red Flags When Transferring Money

Cybersecurity 101 – 2022 Update

Cybersecurity 101

New Changes to Web-Portal Password Requirements

Equifax Data Breach Update: Make a claim today

Important Disclosures

Leonard Rickey Investment Advisors, PLLC (“LRIA”), is an SEC registered investment adviser located in the State of Washington. Registration does not imply a certain level of skill or training. For information pertaining to the registration status of LRIA, please contact LRIA or refer to the Investment Adviser Public Disclosure website (www.adviserinfo.sec.gov).

This is provided for general information only and contains information that is not suitable for everyone. As such, nothing herein should be construed as the provision of specific investment advice or recommendations for any individual. To determine which investments may be appropriate for you, consult your financial advisor prior to investing. There is no guarantee that the views and opinions expressed herein will come to pass. This newsletter contains information derived from third party sources. Although we believe these third-party sources to be reliable, we make no representations as to the accuracy or completeness of any information prepared by any unaffiliated third party incorporated herein and take no responsibility therefore.

Any projections, forecasts and estimates, including without limitation any statement using “expect” or “believe” or any variation of either term or a similar term, contained here are forward-looking statements and are based upon certain current assumptions, beliefs and expectations that LRIA considers reasonable or that the applicable third parties have identified as such. Forward-looking statements are necessarily speculative in nature, and it can be expected that some or all of the assumptions or beliefs underlying the forward-looking statements will not materialize or will vary significantly from actual results or outcomes. Some important factors that could cause actual results or outcomes to differ materially from those in any forward-looking statements include, among others, changes in interest rates and general economic conditions in the U.S. and globally, changes in the liquidity available in the market, change and volatility in the value of the U.S. dollar, market volatility and distressed credit markets, and other market, financial or legal uncertainties. Consequently, the inclusion of forward-looking statements herein should not be regarded as a representation by LRIA or any other person or entity of the outcomes or results that will be achieved by following any recommendations contained herein. While the forward-looking statements here reflect estimates, expectations and beliefs, they are not guarantees of future performance or outcomes. LRIA has no obligation to update or otherwise revise any forward-looking statements, including any revisions to reflect changes in economic conditions or other circumstances arising after the date hereof or to reflect the occurrence of events (whether anticipated or unanticipated), even if the underlying assumptions do not come to fruition. Opinions expressed herein are subject to change without notice and do not necessarily take into account the particular investment objectives, financial situations, or particular needs of all investors.

For additional information about LRIA, including fees and services, please contact us for our Form ADV disclosure brochure using our contact information herein. Please read the disclosure brochure carefully before you invest or send money.