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IIPS Monthly Update

Updated: Aug 18, 2022

Good Morning,

I hope that this email finds you, your family, and your loved ones doing well and enjoying a beautiful spring! Below are a few items of interest I wish to communicate this month. Thank you for your business and feel free to call or write with any questions, schedule a meeting, or request service.

Morgan Stanley

Morgan Stanley has recently agreed to settle a class-action lawsuit over a data breach. The breach occurred due to the sale of servers containing personal information to a third party. This was passed on to us by a current client and we wanted to share this information in case anyone receives similar letters from the lawsuit. A few credible articles are included for further information.

For the most part, the settlement is unrelated to our business dealings and the accounts you hold with us. However, if you held accounts with Morgan Stanley, either now or prior, you may have been affected.

FDIC and SPIC Insurance

This month we wanted to take a moment to discuss your FDIC and SPIC coverages and the differences between them.

LPL Financial is a member firm of the Securities Investor Protection Corporation (SIPC). Membership provides account protection up to a maximum of $500,000 per client, of which $250,000 may be claims for cash. For an explanatory brochure, please visit Through London Insurers, LPL Financial accounts have additional securities protection to cover the net equity of client accounts up to an overall aggregate firm limit of $600 million, subject to conditions and limitations.

London Insurers rely on SIPC to determine the extent of losses incurred by individual LPL account holders. This additional protection covers losses above limits available from SIPC and would be payable up to a total of $600 million.

The account protection applies when a SIPC member firm fails financially and is unable to meet its obligations to securities clients, but it does not protect against losses from the rise and fall in the market value of investments. This extensive coverage reflects a strong commitment to serving the investment needs.

FDIC differs in that it only covers cash, up to $250,000. You may be familiar with FDIC through your checking or savings accounts; however, your Insured Cash Accounts and Deposit Cash Accounts at LPL also fall under FDIC coverage.

It should be noted that both SIPC and FDIC only step in when the brokerage firm or bank fail and are unable to meet the obligations to account holders. They do not cover any losses in the market and do not promise any returns.

Yield Curve

In years past the US Treasury Yield Curve has been a relatively good predictor of recessions. The Federal Reserve adjusts interest rates on US Treasuries to either promote or slow economic growth. Generally, longer-term treasuries provide a better yield than short-term treasuries, resulting in a positive curve. An inverted yield curve occurs when short-term treasuries offer a higher yield than longer-term treasuries. the inverted yield curve can indicate the Federal Reserve's intent to show economic growth, usually due to inflationary pressures.

Currently, 2-year treasuries are yielding better than 10-year treasuries resulting in an inverted curve for that portion of the graph. According to LPL Strategists, this is not a cause for alarm yet. This represents just one part of the yield of the curve with 3-month/10-year treasuries continuing to remain positive. The strategists do not expect a recession this year, however, it is something worth keeping an eye on as the year progresses.

Best Regards,

Have a friend, co-worker, or family member who recently shared about retiring, changing jobs, needing a financial plan, or 401(k) rollover? We offer a complimentary consultation for anyone you think could benefit from our services. David J. Blount CERTIFIED FINANCIAL PLANNER ™ Investment & Insurance Planning Services, LLC 992 Palmetto Street Oviedo, FL 32765 (407) 719-0940 Securities offered through LPL Financial, Member FINRA/SIPC

Content in this material is for general information only and is not intended to provide specific advice or recommendations for any individual. The economic forecasts set forth in this material may not develop as predicted.

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