This will be the quarter that we look back on and never forget. It was the time that a virus spread with a silent vengeance, and the world came to a screeching halt. You may be feeling quite disoriented, fearful or even anxious as you read this note since ‘normal’ for all of us has been shaken to its core due to Covid-19. You are likely hunkering down at home, which is what you should do, with little of your regular activities to keep you busy. If you are like me, it literally feels like the earth has stopped spinning on its axis. Up is down, and right is left. Trust me when I say that it is completely normal to feel this way in the context of what we are dealing with as a human species.
I do not come to you with answers or any conclusions that will change the world…there are people that are much smarter than me working on that now, and I have confidence that they will figure it out. But I can bring some encouragement and suggest some small actions that might, just maybe, help us feel like planet earth is starting to rotate once again.
What can you do?
The spread of Covid-19 has impacted the global economy with a speed and impact that is unlike anything seen in our lifetime. This does not mean that happiness and contentment are totally out of your control, however. Mindset is key…start by realizing that the sun still rises every morning like the picture at the top of the article. There is new hope with each new day. I am sure you have found, as have I, that there is now more time to watch movies, read a book, take a distance-appropriate walk to enjoy the spring weather or call someone (yes, actually call them rather than text) to see how they are doing.
If you are sheltering at home with loved ones, you have probably seen them more in the last two weeks than you have for months. We should all continue to do more of these things, and the more we do, the more connected we will stay. I am not a loquacious extrovert, but I have thoroughly enjoyed being around and talking with the ones I care most about. And the more connected we stay, the more human we will feel. This is where happiness and contentment hide, not in your investment portfolio or the latest round of news.
What are we doing?
Actions taken during times of fear in the markets will have implications for years to come. The question is whether they will be positive or negative. For the long-term investors, which are clients that we serve, volatility creates opportunity. We have taken advantage of this opportunity by tax loss harvesting, which allows us to realize the losses for tax savings, but then invest the proceeds right back in something else so the money is never out of the market. The tax savings for our clients this year will be significant. We have also looked to strategically rebalance portfolios. Because some of the fixed income assets have gains over the last year, we have sold those gains to go buy equity funds that are now at a discount. It rebalances the ship and holds to the strategy of selling high and buying low.
What is next?
The fact is, I don’t know. No one does, but that’s OK. We are still waiting on the details of the massive Stimulus bill that was signed into law on March 27th. There are too many details for me to summarize here. If you want a deep dive in to the details, you can find that here. I plan to write more on this soon, but if you have any questions about this, please do not hesitate to call our office. We are all working remotely, but the extensions still ring right to us. Know that we are here to help in this time of uncertainty. Your well-being is of greatest concern to us, and not just financially. Be safe, be smart, and be part of the global solution for everyone by staying home.
We will see you soon,
Josh, Mike, Matt and Sandra