From Jack Reutemann – Special Message

From Jack Reutemann – Special Message

Dear clients, family and friends,

As a follow-up to last Monday’s email, I want to thank the dozens of people who wrote back with praise and thanks. Last week saw a 15% drop in the S&P 500. Meanwhile, our SPXS position shot up almost 45% for the week. The position currently enjoys a profit of 63% in just 17 days. 

 Also, as I write this, it appears that the Administration and Congress will reach a trillion-dollar stimulus package before the end of the day. We have certainly been tricked and disappointed in the past, but this time let’s hope they have put politics aside and do the right thing for our country. 

I have made the difficult but prudent decision to exit our SPXS position and protect our epic profit of 63%. Remember the old saying, “Pigs get fat, hogs get slaughtered.’’ It’s in play right here, right now.

Tomorrow brings us another day, and our process will allow us to make the right decision. This may be just a few days of hiatus of green over red, and then back to more sell off.

Right now we need to be praying for the millions of Americans in the travel, hotel, restaurant, retail, manufacturing, and service sectors who have lost their jobs—many may be permanent. Most of them were living “paycheck to paycheck” before the Coronavirus reared its ugly head. Now I shudder to imagine the hardships they face.

All of my comments from last Monday remain in play. Federal money will help dislocated employees and small businesses in the short term. But the damage to GDP and consumer confidence will require months to repair. You know anybody looking to buy a restaurant or a hotel? I don’t think so.

Pray for our great country. Worst case scenario is this is a replay of the 1918/1919 Spanish flu. 

Please write back or call me to talk. I am sequestered at home as is most of our staff. I have nothing to do but send emails and speak with all of you!  

Seriously, don’t hesitate to call me. I am here for YOU.​

Jack  240 401 2355 

Jack Reutemann, Jr

Research Financial Strategies​

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Emergency Special Market Update

Emergency Special Market Update

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Emergency Special Market Update

Dear friends, family and clients,  

Wow! In my 45 years I have never seen this.  Prior bear markets (a decline of 20% or more from the last trailing high of the S&P 500 index—which was 2/19/2020) were caused by the collapse in fundamental economics, such as the banking and bad real-estate loan crisis of 2007-2009. Or the irrational tech bubble of 2000-2002. To the best of my knowledge, this is the first bear market caused by a disease, since the impact of both the Spanish flu of 1918-1919 combined with WWI. 

I am going to share my thoughts with you, and I have attached many of my reference points, not in chronological order, both above and below.  I apologize for that, for it is above my pay grade.  I am desperate to get this email out to you, and I apologize for any linguistic glitches. I normally have a brilliant staff to clean up these emails. I encourage you all to write me back with your candid comments and questions:

There are 7 major parts to the mess we are in:

  1. The humanitarian cost to the economy of illness and deaths is enormous.  Our thoughts and prayers to all who have lost a family member or friend. Not to make light of that, but the economic destruction is epic.

2. Why is this impacting the economy and the stock markets? Here is where I go random on you.  The attached article on the “manufacturing supply chain” shows major global ramifications.  By example, the parts of an Apple iPhone come from 26 different countries.  You only need one part missing, and no iPhone shipped.  Extend this concept to everything that is manufactured globally:  TV’s, phones, computer gear, appliances, automobiles, tractors, medical supplies and big pharm, to name just a few.  A statistic I trust more than the Fed is a recent survey by Dunn & Bradstreet of their Fortune 1000 customers, which shows that 94% of transportation management executives in those companies reported supply change interruptions.  Even if you were motivated to buy something, the news is already reporting enormous lack of supply.  Think of Samsung TV’s and phones from South Korea, computer gear from Japan, cars and trucks, appliances from South Korea, Japan, Mexico, China, Germany, Italy, etc.  The math will make your head explode.

3. You need to listen to the following statistics  from our federal agencies.  71% of US Gross Domestic Product (GDP) comes from consumers and small businesses.  This spending is from the top 25% of US consumers and businesses.  Not a statistic that we should be proud of, but 50% of consumers have a negative net worth, meaning their liabilities are greater than their assets.  70% of Americans don’t have $500 in their checking account to fund an emergency car repair, etc.  The economy revolves around the 30% of the wealthiest Americans, who are responsible for this 71% of GDP.  In most cases, they have stopped spending money.

4. The Fed at about 3 PM on Sunday, today, as I write this, dropped overnight rates to banks to the 0.00 to 0.25% range.  Who will this help? More  random questions and thoughts:  Are you going to go out tomorrow and buy a new auto/truck because the interest  rate is 1% less? Book a cruise? (They are shut down for 60 days!) Buy airline tickets to Disneyland??  It’s closed.  Go to Home Depot or Lowes and buy a new $50,000 kitchen or bathroom renovation? The one bright spot is refinancing and new house purchases.  The Fed rate cut should trickle down to lower mortgage interest rates.  If you haven’t checked your home mortgage interest rate lately, do so right now.  Caution, I have dozens of mortgage and bank lending officers who are clients.  Their pipeline is 2 to 3 months out.  In many cases, they have closed their pipelines to new applications.

5. The combination of decreased consumer and small business spending, combined with simple human fear, has taken a toll on all stock markets.  A long time ago I learned the expression, “The trend is your friend.” Since 2/19/2020, the all-time high mentioned above, we have had 17 stock market days: 13 down, 4 up.  End of game.  Restaurants, retail, cruise lines and leisure travel have taken a huge hit.  I’m sure you have seen the pictures on the Internet of the empty shelves in all grocery stores, Costco, Wal-Mart, etc.  This is not going to be miraculously repaired over night because interest is cheaper.  And by the way, don’t expect those interest rate cuts to banks to trickle down overnight to your credit card balances.  The most credit worthy of the US citizens, about 25%, will get a better rate on an auto/truck loan or a mortgage.  Per above, 70% of Americans were frozen in poverty before 2/19/2020 and will continue to be so.

6. There are a couple of bright spots.  Student loan interest forgiveness, 2 weeks of unpaid wages to small business employees. And here is the big one (article attached). There are approximately 100 banks and lenders that have loaned billions to the small/medium oil patch producers, i.e., not Exxon Mobil.  These small producers, who mostly do shale fracking, have an average cost to produce and extract at $31/barrel.  Oil currently fetches about $30/barrel.  You can’t make money spending $31 to sell something for $30.  You don’t need to have a Ph.D. in Economics to figure that out.  Will the Fed’s interest rate cuts make oil go back to $60/barrel?  More than likely,  not!  Due to the supply chain disruptions above, in China, and most other countries that have manufacturing-based economies, are buying less oil. (Think G20, Group of 20, 19 nations and the European Union.)   Add to that consumers, airlines, cruise lines, etc.

7. Now for the scary,  gross part (references attached). 95% of the US consumption of 200+ varieties of fruits, nuts and vegetables come from California.  The major West coast cities from Seattle to San Diego are suffering from a pre-2/19/2020 epidemic of homeless street people living in tents.  Again, it doesn’t take much to realize that these people are not the healthiest, cleanest and best cared-for individuals to begin with.  COVID-19 will hit them hard.  In the attached reference, you’ll see that there are approximately 12 to 15 million migrant workers in CA responsible for the harvesting of those 200+ fruits, nuts and vegetables.  What happens to the food supply chain when COVID-19 hits the migrant workers in CA?  That might just explain all the empty shelves in grocery stores this past week. Consumers get it.

 I’m sorry if you think I am an alarmist.  My number one job is to protect you and your family’s investments.  We are doing that.  Many accounts went to 100% “cash” on 2/28/2020,  and other accounts have been substantially defensive, known as “short”,  since then.  We have the greatest scientists, MD’s, and Ph.D.’s working on this pandemic.  If you haven’t seen Dr. Anthony Fauci on TV, Google him.  His team is the best, and not a bunch of TV talking heads.

Please write me back with your questions and comments ASAP.  I am doing my best to protect you and your family.

Jack

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Sources:
https://www.nytimes.com/2020/03/15/world/coronavirus-live.html?emc=edit_na_20200315&ref=cta&nl=breaking-news&campaign_id=60&instance_id=0&segment_id=22258&user_id=8ceee818e1df4b6e6a8576714a4f7c82&regi_id=67446251
https://markets.businessinsider.com/news/stocks/coronavirus-ray-dalio-not-solved-rate-cuts-stock-market-hedging-2020-3-1028964518?utm_campaign=browser_notification&utm_source=desktop
https://finance.yahoo.com/news/ackman-hedges-protect-against-coronavirus-225332704.html
https://markets.businessinsider.com/news/stocks/oecd-slashes-2020-global-growth-outlook-on-coronavirus-fears-2020-3-1028954418?utm_source=markets&utm_medium=ingest
https://slate.com/technology/2013/07/california-grows-all-of-our-fruits-and-vegetables-what-would-we-eat-without-the-state.html
https://www.farmprogress.com/tree-nuts/what-happens-if-us-loses-california-food-production
https://www.brookings.edu/wp-content/uploads/2020/03/20200302_COVID19.pdf
https://www.politico.com/news/2020/03/04/house-coronavirus-funding-121065
https://moneywise.com/a/these-restaurant-chains-are-closing-2020
https://www.dnb.com/content/dam/english/economic-and-industry-insight/DNB_Business_Impact_of_the_Coronavirus_US.pdf
https://www.axios.com/coronavirus-climate-change-risks-bc81ec96-ca03-4af7-867f-2aac2648b2d5.html
https://thehill.com/policy/healthcare/486645-cdc-americans-over-60-should-stock-up-on-supplies-avoid-crowds
https://www.marketwatch.com/story/pimco-its-just-going-to-get-worse-for-economy-2020-03-08?mod=hp_minor_pos20
https://www.niaid.nih.gov/about/director
https://morningconsult.com/form/consumer-confidence-tracking-us/

Market Commentary – March 9, 2020

Market Commentary – March 9, 2020

Weekly Financial Market Commentary

March 9, 2020

Our Mission Is To Create And Preserve Client Wealth

Last week, market volatility reached levels that make many investors uncomfortable.

On Monday, the Dow Jones Industrial Average surged higher, delivering its biggest one-day point gain in history. The catalyst may have been reports that ‘Group of Seven’ (G7) finance ministers and central bank governors were meeting via conference call on Tuesday. French Finance Minister Bruno Le Maire indicated the discussion would lead to coordinated monetary efforts to address economic issues related to the coronavirus, reported Reuters.

The G7 includes seven countries: United States, United Kingdom, Germany, Canada, Japan, France, and Italy. The European Union is a ‘non-enumerated’ member. The nations represent about 50 percent of the global economy, according to the Council of Foreign Relations, and was formed to coordinate global policy.

On Tuesday, the U.S. Federal Reserve (Fed) implemented a surprise rate cut. The pre-emptive move surprised many because the Fed’s policy-setting meeting was just two weeks away. The policy change sparked anxiety among investors. The Standard & Poor’s 500 Index, which had gained about 4.6 percent on Monday, dropped 2.8 percent on Tuesday, reported Ben Levisohn of Barron’s.

U.S. Treasury yields moved lower, too. The yield on 10-year U.S. Treasuries closed below 1 percent for the first time ever last week, reported Alexandra Scaggs of Barron’s.

On Friday, a robust employment report was largely ignored, reported Randall Forsyth of Barron’s, as were increases in the Atlanta Federal Reserve’s GDPNow estimate indicating economic growth during the first quarter may have been stronger than anticipated. Despite a downward swing on Friday, major U.S. stock indices finished the week higher.

Forsyth also reported Kenneth Rogoff, Professor of Economics and Public Policy at Harvard, is concerned the economic consequences of the coronavirus could include inflation. Production slowdowns and supply chain disruptions caused by the coronavirus could result in a mismatch between the supply of goods available and demand for goods across the globe.

In a Project-Syndicate commentary, Rogoff explained, “…the challenge posed by a supply-side-driven downturn is it can result in sharp declines in production and widespread bottlenecks. In that case, generalized shortages – something some countries have not seen since the gas lines of 1970s – could ultimately push inflation up, not down,” he contends.”

When are people the gloomiest?
In 2005, a psychologist considered a variety of criteria – weather, debt levels, income, post-holiday mindset, New Year’s resolutions, motivation levels, and more – and decided the third Monday in January was the day people are gloomiest, reported the United Kingdom’s Medical News Today.

His efforts were part of a travel company marketing campaign encouraging people to book flights in order to combat the post-holiday blues.

Now, The Economist has carefully analyzed music consumption to “create a quantitative measure of seasonal misery.” The publication used data from a popular music streaming service that offers 50 million options to 270 million people in 70 plus countries to track the type of songs people around the world listened to each month from January 1, 2017 to January 29, 2020.

The Economist relied on the streaming company to determine the emotional scale of the songs played during any given month. It explained, “The firm has an algorithm that classifies a song’s “valence,” or how happy [a song] sounds, on a scale from 0 to 100. The algorithm is trained on ratings of positivity by musical experts and gives Aretha Franklin’s soaring “Respect” a score of 97; Radiohead’s gloomy “Creep” gets just 10.” The happier end of the valence spectrum also included:

  • OutKast’s “Hey Ya!”
  • Taylor Swift’s “Shake It Off”
  • Luis Fonsi’s “Despacito”

The sadder end included:

  • Adele’s “Make You Feel My Love”
  • Simon & Garfunkel’s “Bridge Over Troubled Waters”
  • Nina Simone’s “I Put A Spell On You”

When the results were tallied, the global top 200 songs for February were the gloomiest overall. If you were curious, people played the happiest songs during July, although there was a joyful spike in late December for Christmas.

Weekly Focus – Think About It
“The whole of life itself expresses the blues. That’s why I always say the blues are the true facts of life expressed in words and song, inspiration, feeling, and understanding. The blues can be about anything pertaining to the facts of life. The blues call on God as much as a spiritual song do.”
–Willie Dixon, Blues musician

Best regards,

John F. Reutemann, Jr., CLU, CFP®

 

P.S.  Please feel free to forward this commentary to family, friends, or colleagues. If you would like us to add them to the list, please reply to this email with their email address and we will ask for their permission to be added.

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Investment advice offered through Research Financial Strategies, a registered investment advisor.
* This newsletter and commentary expressed should not be construed as investment advice.
* Government bonds and Treasury Bills are guaranteed by the U.S. government as to the timely payment of principal and interest and, if held to maturity, offer a fixed rate of return and fixed principal value.  However, the value of fund shares is not guaranteed and will fluctuate.
* Corporate bonds are considered higher risk than government bonds but normally offer a higher yield and are subject to market, interest rate and credit risk as well as additional risks based on the quality of issuer coupon rate, price, yield, maturity, and redemption features.
* The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. You cannot invest directly in this index.
* All indexes referenced are unmanaged. The volatility of indexes could be materially different from that of a client’s portfolio. Unmanaged index returns do not reflect fees, expenses, or sales charges. Index performance is not indicative of the performance of any investment. You cannot invest directly in an index.
* The Dow Jones Global ex-U.S. Index covers approximately 95% of the market capitalization of the 45 developed and emerging countries included in the Index.
* The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
* Gold represents the afternoon gold price as reported by the London Bullion Market Association. The gold price is set twice daily by the London Gold Fixing Company at 10:30 and 15:00 and is expressed in U.S. dollars per fine troy ounce.
* The Bloomberg Commodity Index is designed to be a highly liquid and diversified benchmark for the commodity futures market. The Index is composed of futures contracts on 19 physical commodities and was launched on July 14, 1998.
* The DJ Equity All REIT Total Return Index measures the total return performance of the equity subcategory of the Real Estate Investment Trust (REIT) industry as calculated by Dow Jones.
* The Dow Jones Industrial Average (DJIA), commonly known as “The Dow,” is an index representing 30 stock of companies maintained and reviewed by the editors of The Wall Street Journal.
* The NASDAQ Composite is an unmanaged index of securities traded on the NASDAQ system.
* International investing involves special risks such as currency fluctuation and political instability and may not be suitable for all investors. These risks are often heightened for investments in emerging markets.
* Yahoo! Finance is the source for any reference to the performance of an index between two specific periods.
* Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
* Economic forecasts set forth may not develop as predicted and there can be no guarantee that strategies promoted will be successful.
* Past performance does not guarantee future results. Investing involves risk, including loss of principal.
* The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee it is accurate or complete.
* There is no guarantee a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.
* Asset allocation does not ensure a profit or protect against a loss.
* Consult your financial professional before making any investment decision.
* To unsubscribe from the Weekly Market Commentary please reply to this e-mail with “Unsubscribe” in the subject.

 

Investment advice offered through Research Financial Strategies, a registered investment advisor.

Sources:
https://www.nbcnews.com/business/markets/wall-street-takes-deep-breath-after-worst-week-decade-n1146886
https://www.reuters.com/article/us-health-coronavirus-g7/us-mnuchin-powell-to-lead-g7-finance-call-on-coronavirus-response-idUSKBN20P2JT
https://www.cfr.org/backgrounder/g7-and-future-multilateralism
https://www.barrons.com/articles/dow-jones-industrial-average-finishes-week-higher-the-pain-isnt-over-51583548961?mod=hp_DAY_1 (or go to https://peakcontent.s3-us-west-2.amazonaws.com/+Peak+Commentary/03-09-20_Barrons-The_Stock_Market_Finished_the_Week_Higher-The_Pain_Isnt_Over-Footonote_4.pdf)
https://www.barrons.com/articles/u-s-treasury-yields-plummet-past-0-8-for-the-first-time-51583501109 (or go to https://peakcontent.s3-us-west-2.amazonaws.com/+Peak+Commentary/03-09-20_Barrons-US_Treasury_Yields_Keep_on_Plummeting-Footnote_5.pdf)
https://www.barrons.com/articles/the-rate-cut-drug-might-not-cure-ailing-market-51583545555?mod=hp_DAY_2 (or go to https://peakcontent.s3-us-west-2.amazonaws.com/+Peak+Commentary/03-09-20_Barrons-The_Rate-Cut_Drug_Might_Not_Cure_Ailing_Market-Footnote_6.pdf)
https://www.project-syndicate.org/commentary/next-global-recession-hits-the-supply-side-by-kenneth-rogoff-2020-03
https://www.medicalnewstoday.com/articles/324236#A-self-fulfilling-prophecy
https://www.economist.com/graphic-detail/2020/02/08/data-from-spotify-suggest-that-listeners-are-gloomiest-in-february (or go to https://peakcontent.s3-us-west-2.amazonaws.com/+Peak+Commentary/03-09-20_TheEconomist-Data_from_Spotify_Suggest_that_Listeners_are_Gloomiest_in_February-Footnote_9.pdf)
https://www.azquotes.com/quote/709869?ref=blues-music

Market Commentary – March 9, 2020

Market Commentary – March 2, 2020

Weekly Financial Market Commentary

March 2, 2020

Our Mission Is To Create And Preserve Client Wealth

Take a deep breath.

We have experienced downturns before.

Think back to 2018. During the last quarter of the year, major stock indices in the Unites States suffered double-digit losses, much of it during December. What happened next? By the end of 2019, those indices had reached new highs.

The reasons for, and performance following, market downturns varies. The key is not to panic.

Last week, U.S. stock indices lost significant value when the coronavirus spread outside of China, and expectations for companies’ performance in 2020 changed. At the start of the week, markets anticipated positive earnings growth (i.e., higher profits) during 2020. By the end of the week, they suspected earnings might be flat for the year.

At the end of last week, FactSet reported 68 companies in the Standard & Poor’s 500 Index had offered negative earnings guidance for the first quarter. In other words, the companies didn’t expect to be as profitable from January through March as analysts anticipated. That’s fewer companies than normal, relative to the five-year average. However, the number could increase. FactSet’s John Butters explained:  “…early in the quarter, a number of S&P 500 companies stated they were unable to quantify an impact from the coronavirus or did not include the impact from the coronavirus in their guidance. Thus, there may be an increase in the number of companies issuing negative guidance later in the first quarter as these companies gain clarity on the impact of the coronavirus on their businesses.”

Changing profit expectations are one concern for investors. Another is fear. Investors are afraid the current economic expansion and bull market may end. At this point in the economic cycle, investors often are both hopeful and doubtful. The Economist explained:  “[Investors] hope that the good times will last, so they are reluctant to pull their money out. They also worry that the party may suddenly end. This is the late-cycle mindset. It reacts to occasional growth scares – about trade wars or corporate debt or some other upset. But it tends not to take them seriously for long.”

Currently, investors are reacting to the coronavirus. They fear it will be the catalyst that sparks recession. While that’s possible, in the past, markets have responded negatively to coronaviruses and then recovered. (Keep in mind, past performance is no indication of future results.) Barron’s cited a private wealth manager who pointed out:  “…this isn’t the first time that an epidemic has rocked the stock market. The S&P 500 fell 15 percent after SARS hit the market in 2003 but was up just over 1 percent six months after the outbreak began.”

No matter the reason, it is unnerving to be an investor when stock markets head south. There is nothing comfortable about watching the value of your savings and investments decline. Regardless of the discomfort, selling when markets are falling has rarely proved to be a good idea. Investors who stay the course may have opportunities to regain lost value if the market recovers, as it has before.

Investors also may have opportunities to buy shares of attractive companies at reduced prices. Warren Buffet offered this reminder last week in a Barron’s article:  “…[the coronavirus] makes no difference in our investments. There’s always going to be some news, good or bad, every day. If somebody came and told me that the global growth rate was going to be down 1 percent instead of 1/10th of a percent, I’d still buy stocks if I liked the price, and I like the prices better today than I liked them last Friday.”

Until the full effect of the coronavirus is known, markets are likely to remain volatile.

What you should know about the coronavirus. The coronavirus is now officially known as Coronavirus Disease 2019 or COVID-19. Last week, it spread to countries outside of China. If there is any good news about the contagious disease, it is COVID-19 may be relatively mild.

In its February 28 briefing, the Director-General of the World Health Organization (WHO) stated, “It also appears that COVID-19 is not as deadly as other coronaviruses including SARS and MERS. More than 80 percent of patients have mild disease and will recover.”

The Director-General identified the symptoms of COVID-19 stating, “…for most people, it starts with a fever and a dry cough, not a runny nose. Most people will have mild disease and get better without needing any special care.”

Currently, more than 20 vaccines are being developed. In the meantime, there are things you can do to protect yourself. They include:

  • Washing your hands with soap and water regularly or cleaning them with an alcohol-based hand sanitizer.
  • Cleaning and disinfecting frequently touched objects and surfaces.
  • Cover your mouth and nose with a tissue or your sleeve – not your hands – when you cough or sneeze.
  • Avoiding close contact with people who are sick.
  • Staying home and avoiding travel when you are sick.
  • Contacting your medical professional when you experience symptoms, which include shortness of breath.

 WHO also recommended educating yourself about the coronavirus. Make certain to gather information from reliable sources, such as WHO or the United States’ Centers for Disease Control (CDC), and have healthy skepticism when it comes to unknown sources. Misinformation and disinformation about COVID-19 have been spreading almost as quickly as the virus itself.

The Director-General closed last week’s briefing by saying, “Together, we are powerful…Our greatest enemy right now is not the virus itself. It’s fear, rumors, and stigma. And, our greatest assets are facts, reason, and solidarity.”

If you would like to talk about the potential economic effects, give us a call. We look forward to talking with you.  

Weekly Focus – Think About It
“The time of maximum pessimism is the best time to buy, and the time of maximum optimism is the best time to sell.”
–Sir John Templeton, Investor, asset manager, philanthropist

Best regards,

John F. Reutemann, Jr., CLU, CFP®

 

P.S.  Please feel free to forward this commentary to family, friends, or colleagues. If you would like us to add them to the list, please reply to this email with their email address and we will ask for their permission to be added.

Investment advice offered through Research Financial Strategies, a registered investment advisor.

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Investment advice offered through Research Financial Strategies, a registered investment advisor.
* This newsletter and commentary expressed should not be construed as investment advice.
* Government bonds and Treasury Bills are guaranteed by the U.S. government as to the timely payment of principal and interest and, if held to maturity, offer a fixed rate of return and fixed principal value.  However, the value of fund shares is not guaranteed and will fluctuate.
* Corporate bonds are considered higher risk than government bonds but normally offer a higher yield and are subject to market, interest rate and credit risk as well as additional risks based on the quality of issuer coupon rate, price, yield, maturity, and redemption features.
* The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. You cannot invest directly in this index.
* All indexes referenced are unmanaged. The volatility of indexes could be materially different from that of a client’s portfolio. Unmanaged index returns do not reflect fees, expenses, or sales charges. Index performance is not indicative of the performance of any investment. You cannot invest directly in an index.
* The Dow Jones Global ex-U.S. Index covers approximately 95% of the market capitalization of the 45 developed and emerging countries included in the Index.
* The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
* Gold represents the afternoon gold price as reported by the London Bullion Market Association. The gold price is set twice daily by the London Gold Fixing Company at 10:30 and 15:00 and is expressed in U.S. dollars per fine troy ounce.
* The Bloomberg Commodity Index is designed to be a highly liquid and diversified benchmark for the commodity futures market. The Index is composed of futures contracts on 19 physical commodities and was launched on July 14, 1998.
* The DJ Equity All REIT Total Return Index measures the total return performance of the equity subcategory of the Real Estate Investment Trust (REIT) industry as calculated by Dow Jones.
* The Dow Jones Industrial Average (DJIA), commonly known as “The Dow,” is an index representing 30 stock of companies maintained and reviewed by the editors of The Wall Street Journal.
* The NASDAQ Composite is an unmanaged index of securities traded on the NASDAQ system.
* International investing involves special risks such as currency fluctuation and political instability and may not be suitable for all investors. These risks are often heightened for investments in emerging markets.
* Yahoo! Finance is the source for any reference to the performance of an index between two specific periods.
* Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
* Economic forecasts set forth may not develop as predicted and there can be no guarantee that strategies promoted will be successful.
* Past performance does not guarantee future results. Investing involves risk, including loss of principal.
* The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee it is accurate or complete.
* There is no guarantee a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.
* Asset allocation does not ensure a profit or protect against a loss.
* Consult your financial professional before making any investment decision.
* To unsubscribe from the Weekly Market Commentary please reply to this e-mail with “Unsubscribe” in the subject.

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