A message from President & CEO Norm Cook:
I trust you are doing everything you can to keep you and your loved ones healthy during this coronavirus pandemic. Surely all of us have been affected in various ways and with such immediacy no one had time to prepare appropriately. While the number of cases has dramatically spiked in the US and across the globe there is great hope for effective treatment just around the corner. We cannot offer enough praise to the front-line health care workers. They are stepping into the most challenging circumstances to use their skills and training to comfort and care for those afflicted with the virus. These individuals are truly the best of humanity.
This unforeseen and dramatic global event has taken companies from record profits to crisis management in a matter of days. The economic impact has spared no one and it has been accompanied by significant market volatility. We have seen both historic drops and record rises in just the past week alone. The government’s swift movement to offer stimulus and liquidity to the markets has provided a level of support that may be the foundation to creating a floor. Private industry has answered the call to support the war on COVID-19 with robust production from medicines to machines in a way not seen since WWII. Moreover, we learned yesterday of a call for a “Phase 4” $2 trillion infrastructure bill to bolster confidence in a robust return of our economy.
As we have for over 40 years, we remain disciplined and are taking action on those things we can control to add value to our client’s portfolios. We have recently employed tax loss harvesting to mitigate future liability in taxable accounts while keeping market exposure constant. This has provided tremendous benefits during the recent 20% surge in the equity market. The equity market entered and exited a Bear market in just 18 days which is the second shortest in history, trailing only a 12-day bear market in 1931.
Compounding the challenges caused by the coronavirus pandemic, an oil production war between Saudi Arabia and Russia has forced prices to plummet. This week oil fell below $20 dollars a barrel and less global demand has decreased the likelihood of new agreements to slow production.
WEALTHSTONE ADVISORS is focused on the policy responses from monetary, fiscal and health authorities. The US is leading the charge with aggressive action from the Federal Reserve, with the Bank of England following suit. While the response from the European Central Bank has been measured, it will likely deliver additional liquidity. In the months ahead we will pay special attention to credit spreads and how this affects fixed income across the curve. Our WEALTHSTONE Investment Committee is actively reviewing all asset classes and market sectors for the purpose of adjusting and rebalancing portfolios to be well positioned for the future.
Please know we will continue to work diligently on your behalf as we walk with you through this unprecedented time. Our desire is to communicate well with you and as such will continue reaching out to speak with you personally. As well, you are always welcome to call and schedule a time with us to discuss anything.
Please remain healthy and follow the guidelines for your safety.
President & CEO