We Are Pressed on All Sides, but We Are Not CrushedSubmitted by RetireWiseCFP on April 7th, 2020
As the magnitude of this unprecedented turmoil has taken hold of the country and the world, it has been very hard to fathom. It is difficult to make sense of the carnage and the loss—the loss of lives, first, of course, then the loss of jobs and losses in the markets.
Where are we now?
We are NOT out of the woods yet, because companies have yet to begin to report the scale of the loss of jobs. I think the magnitude of the layoffs will be shocking and frightening to many in the coming weeks. BUT the good news is this: Science is beginning to catch up to and—I am very positive—will triumph over COVID-19. Everyday there is a new permit, a new approval, a new positive trail somewhere around the world. Yes, the day cannot come fast enough.
Where do we go from here?
We stay with our all-weather quality portfolio approach. We must remain disciplined. We must resolve to carry on each day with true peace, peace different from what the world gives. Should there be concern? Yes, of course, but we must not let our hearts be so troubled that we let fear overcome us.
On fixed income and alternatives:
The Federal Reserve has been pitch perfect in its moves thus far to provide credit and in its willingness to make more credit available as needed. I have nothing to add to “perfect.”
On Alternatives: Again, not working. Yes, we know that a dead clock is right twice per day.
What should we look out for?
Yes, there is an election on the horizon, and the politicians will and must air their differences. However, they need to engage in a way that does not tear down any fragile confidence we have in the economy—so employers can hire and so people can make the big decisions: buy a house; purchase a car; start a family; or open a new business in 2020.
When I compare where we are now to the letter I wrote just 3 months earlier, it is quite humbling. This is why I am often a reluctant forecaster of the future. The year began with so much optimism that I wrote this: “We use these two frameworks to invest through the storms, through the rains, also through the blinding sunshine of hype. Do I know exactly what is in store for 2020? No, but I am humbly prepared for the crisis and opportunities that await us.” Of course, I could not imagine the scale of the medical challenge COVID-19 will unleash world-wide, but our all-weather quality portfolio approach was in place upfront.
Femi T. Shote, MSF, ChFC, CFP®
Accredited Investment Fiduciary®