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What Happened Last Week and What It Means to You: June 3rd, 2022

Week Ending June 3rd, 2022

Economy Created 390,000 new jobs…

Better than expected but growth rate continues to slow.
What does it mean – Unemployment up from 3.5% to 3.6%. Yet there are still over 10 million less Americans working today than pre shutdown.

If you want a job, you can get one…

Job Opening and Labor Turnover Survey showed there were 11.4 million job vacancies in the U.S. at the end of April.
What does it mean – Government policy is getting in the way of the free markets. Employment is available but employers are forced to compete with the government and the multitude of government programs that were originally designed to help people but are now being used to sustain government dependency. This is unsustainable. Margaret Thatcher said it best, “The problem with socialism, is you eventually run out of other people’s money.”

Small business payrolls shrink…

Businesses with fewer than 50 employees lost 91,000 workers last month according to ADP.
What does it mean – Midsize and large companies are benefitting from better access to capital and tougher barriers to entry for small companies due to regulations and the overall difficult economic environment.

American families will face rising electricity bills…

While many have felt the pinch of inflation at the store or fueling up their car, your electricity bill is on its way up.
What does it mean – According to the Federal Energy Regulatory Commission the wholesale electric markets for the summer have future prices trading between 77% and 233% higher than last year. While many states are regulated and will not be able to pass on the complete increase right away, this means that we will see rates continue to go up for some time if we do not solve our energy crisis. Drill baby drill!

Below is a great graph showing the increase in gas prices, wind, and solar. Check out nuclear, coal and hydro (I imagine CA citizens wish they had those dams the government ordered destroyed back. Not only would they have more water but maybe more hydroelectric energy). California is now finding out the hard way that leadership and policies matter.

A look at new home sales month-over-month/year-over-year by region…

Northeast (-5.9%/+17.1%); Midwest (-15.1%/-25.5%); South (-19.8%/-36.6%); and West (-13.8%/-12.4%).
What does it mean – The latest report underlines the affordability pressure that has quickly emerged with the spike in mortgage rates. Sales are slowing as fewer buyers can afford the rising rates and cost of living.

Is the Fed finally listening…

Recent reports are starting to show signs that the Fed is slowing the growth rate of money. We will see once reports are released by the Fed.
What does this mean – If true, the fed may be realizing that they have been on the wrong side of inflation and economic science and are finally dealing with reality. Since the insanity of the mandatory shutdown, money supply is up over 39% according to the federal reserve. Rising interest rates will not cure inflation but will slow down demand and hurt the middle and lower class. Volker realized this in the early 80’s and Nobel Laureate Milton Friedman, one of my economic heroes, harped on this throughout the 70’s and his entire career. He was right then, and history will likely prove him right yet again. Mark Twain once said, “History never repeats itself, but it does often rhyme.”

Let’s roll America,

Doug De Groote, CFP®, MBA, CTC
Managing Director

805.230.0111 Main
800.984.3302
818.642.9789 Cell
805.230.0061 Fax
2660 Townsgate Rd Suite 450
Westlake Village, CA 91361
doug@degrootefinancial.com
www.degrootefinancial.com
www.lw4ip.com
De Groote Financial Group, LLC is a federally registered investment adviser that maintains a principal office in the State of California. The information contained in this message is confidential, protected from disclosure and may be legally privileged. If the reader of this message is not the intended recipient or an employee or agent responsible for delivering this message to the intended recipient, you are hereby notified that any disclosure, distribution, copying, or any action taken or action omitted in reliance on it, is strictly prohibited and may be unlawful. If you have received this communication in error, please notify us immediately by replying to this message and destroy the material in its entirety, whether in electronic or hard copy format.

Michelle DeShields

Executive Assistant

Michelle is typically the first person you will speak to when we answer the phone. She manages the calendars and ensures meetings are booked. Michelle is a key member of our team by making sure you get to the right person and that the client experience is always exceptional and evolving to be better.

Fadi Ahmed

Chief Operations Officer and Chief Compliance Officer

Fadi works with clients to ensure an exceptional experience. He coordinates and assures the planning process and wealth management tools are at your fingertips to provide the clarity you deserve and the transparency and access to all your accounts. Fadi ensures the data and information is reflective in our planning software. All changes and updates flow through his desk and he coordinates those changes with the rest of our team.

Andrew Krout

Wealth Advisor, Co-Chief Investment Officer

Andrew Krout is a Wealth Advisor at De Groote Financial Group, LLC. He also serves as a Co-Chief Investment Officer for the firm, focused on wealth management.

Previously, Andrew served as CIO with Kelly Financial in Boston Massachusetts since 2013. He is a licensed investment advisor representative and insurance producer. He graduated from Saint Francis University with a bachelor’s degree in both finance and accounting. He is a candidate for CERTIFIED FINANCIAL PLANNER™ designation. Andrew holds life insurance licenses in Massachusetts, New Hampshire and Connecticut.

Andrew is passionate about serving his clients and investment management and how to apply news and current events to investment decisions. He played Division 1 golf in college, and still enjoys playing and watching the sport in his free time.

David Darst

Co-Chief Information Officer

David Martin Darst, CFA is an Investment Advisor to DeGroote Financial Group, specializing in asset allocation and product selection. Previously, David served for 17 years as a Managing Director and Chief Investment Strategist at Morgan Stanley Wealth Management, with the responsibility for Asset Allocation and Investment Strategy. He joined Morgan Stanley in 1996 from Goldman Sachs, where he held Senior Management Posts within the Equities Division and earlier, for six years as Resident Manager of their Private Bank in Zurich.

David is the author of 13 books, including bestsellers The Art of Asset Allocation, 2nd Edition (McGraw-Hill), and The Little Book that Still Saves Your Assets (John Wiley & Sons). He also appears as a frequent guest on CNBC, Bloomberg, FOX, PBS, and others, and has contributed articles across a variety of publications.

David graduated with a BA in Economics from Yale University, and earned his MBA from Harvard Business School. He has lectured extensively at Wharton, Columbia, INSEAD, and New York University Business Schools, and for nine years, David served as a visiting member at Yale College, Yale School of Management, and Harvard Business School. He is a CFA Charterholder and a member of the New York Society of Security Analysts and the CFA Institute. 

Doug De Groote

Managing Director

Doug is a Certified Financial Planner™ (CFP®) with an MBA in Financial Planning, and is an active member of the Financial Planning Association (FPA). Before establishing De Groote Financial Group, Doug founded the United Wealth Management division of United Capital. Prior to that, Doug was a partner at Crowell, Weedon and Co. He regularly contributes to a variety of financial and general media.

Doug’s passion, and what he believes, is that everyone deserves the opportunity; they deserve to have the freedom and responsibility to be pro-active in achieving independence and financial success.

Doug’s life is focused around his family, wife and three children, and making sure they get the foundation that is necessary for them to have the awareness of the opportunities that abound in our great country.

Doug helps increase his client’s awareness and success, to identify and take advantage of opportunities that present themselves and help protect them from some of the pitfalls or obstacles that are thrown in our paths. With regards to their financial circumstances, Doug helps his clients identify their goals, plan for various outcomes and manage their assets to help them make their vision a reality.