Control Panel: Financial therapy

Investment Analysis Clubs Macro Economic Trends and Risks
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The markets are enough to give anyone anxiety. Might you need a financial therapist? Might you be a good financial therapist and make it a career?

https://www.nytimes.com/2022/08/13/business/financial-therap…

**Where Money Meets Feelings: Financial Therapy Finds Its Footing**

**Planners weren’t equipped to address the emotional roots of how clients dealt with money. Therapists couldn’t guide finances. Now, there’s a bridge.**
**By Charlotte Cowles, The New York Times, Aug. 13, 2022**

**...**

**During the 2008 financial crisis, a handful of financial and mental health professionals banded together to form the Financial Therapy Association, which aimed to spread awareness of the connections between psychology and personal finance....**

**In 2019, the Financial Therapy Association introduced an accreditation program for both financial and mental health professionals to become certified in financial therapy. The coursework, which takes three to six months to complete remotely, covers financial topics (like estate planning and budgeting) as well as therapeutic techniques (such as pinpointing behaviors and attitudes that may hinder financial progress). To earn the designation, students must pass an exam and promise to adhere to a code of ethics, which includes a fiduciary standard and a ban on selling or earning commission from financial products. ...**

**Like traditional therapy and financial planning, financial therapy can vary widely in cost. Practitioners charge from $100 to $800 per session, depending on their fee structure and services. Financial advisers who are certified in financial therapy should be clear about the boundaries of their mental health training, Dr. McCoy said; the same goes for mental health workers and their financial knowledge....** [end quote]

This week’s Control Panel is not anxiety-producing. It’s similar to last week’s except more so.

The markets are singing “Happy Days are Here Again.” The Fear & Greed Index has crept from Neutral into Greed. The trade is risk-on as stocks and junk bonds are rising relative to Treasuries. The USD has gently dropped until it is at the rising 50 day MA.

The Treasury yield curve is rising along its entire duration. It’s inverted in places. If the Fed raises the fed funds rate as expected it will be fully inverted by the end of 2022. The 10-Year Treasury Constant Maturity Minus 2-Year Treasury Constant Maturity is predicting a recession within 6 months to a year. The 10-Year Treasury Constant Maturity Minus 3-Month Treasury Constant Maturity (T10Y3M) hasn’t gone negative yet but it will if the Fed keeps raising as expected.

The METAR for next week is sunny. The markets are celebrating one month with zero CPI inflation as if this means that the Fed will ignore all the other inflationary signs and change its mind about raising interest rates.

Wendy

https://stockcharts.com/freecharts/candleglance.html?VTI,$SP…

https://stockcharts.com/freecharts/candleglance.html?$IRX,$U…

https://stockcharts.com/freecharts/candleglance.html?$SPX,$U…

https://www.cnn.com/markets/fear-and-greed

https://stockcharts.com/freecharts/yieldcurve.php

https://fred.stlouisfed.org/series/T10Y2Y

https://fred.stlouisfed.org/series/T10Y3M

https://www.financialresearch.gov/financial-stress-index/

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The markets are enough to give anyone anxiety.

Wendy,

I am realizing two major concerns on the horizon.

I am in cash so I feel very safe.

I am worried for all the problems people face.

I am trying to figure how the Ethereum market will hold up. It is an oddball. I am trying to time my auction. I might not be able to do so. I have to fully comprehend the contract’s code for minting my NFT. I currently need two weeks before I venture down that path. Three or four weeks to market my NFTs. I am not at all sure if that is a rush to get it done or plenty of time.

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I think we know that John Q Public finds market volatility and especially big swings in value a concern. Especially when trying to build a retirement plan based on contribution plans like 401ks.

They were much happier with the old pension plans where employer took the risk and guaranteed their payments.

Same with annuities where insurance company assumes the risk (for a fee).

It would be great if John Q Public learned a bit about risk tolerance. But that is probably wishful thinking.

Yes, they are calling their financial advisors asking for reassurance. Are they ok or do they need to do something (at the worst possible time)?

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Thank you for recommending this post to our Best of feature.

I think we know that John Q Public finds market volatility and especially big swings in value a concern. Especially when trying to build a retirement plan based on contribution plans like 401ks.

They were much happier with the old pension plans where employer took the risk and guaranteed their payments.

Which of course didn’t always work out in the event of Bankruptcy or shenanigans by Steve’s JC’s?

Now the ultimate “happier” would be Federal government indexed pensions?

Tim

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<Now the ultimate “happier” would be Federal government indexed pensions? >

That’s the Social Security program which everyone who has worked for 10 years and paid into the system (along with their employers) qualifies for.

Wendy

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But always intended as a supplement. Not your only source of income.

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I am in cash so I feel very safe.

That’s only if you consider losing 4-6% a year to be “safe”!

I am trying to figure how the Ethereum market will hold up. It is an oddball. I am trying to time my auction. I might not be able to do so. I have to fully comprehend the contract’s code for minting my NFT. I currently need two weeks before I venture down that path. Three or four weeks to market my NFTs. I am not at all sure if that is a rush to get it done or plenty of time.

I recently read an article that NFT sales volume is way way down. By waiting you may be hurting yourself.

Also, if you aren’t planning on holding the etherium long-term, why does the etherium market matter to you? If someone wants to buy an NFT from you today for $1500, they will transfer ~1 ETH to you, and you will sell it to get the $1500, and transfer the $1500 to your bank.

If ETH happens to go down to $1000, then when you sell the NFT to them for $1500, they will transfer ~1.5 ETH to you, then you sell the ETH, take the $1500 and transfer it to your bank. Roughly same end result.

Likewise, if ETH happens to go up to $1000, then when you sell the NFT, they will transfer ~0.75 RTH to you, you convert to $1500 and send it to the bank.