March 23, 2020
Friends and Clients,
The speed and scale of this virus spreading around the globe, and its impact on global markets is frightening us all.
Here are some questions and observations that are helping me adjust my perspective. I hope you don’t mind me sharing them with you:
Have we ever in our lifetimes been this scared of something we don’t understand (on this scale)?
How does this crisis compare with other challenges we have faced in the USA and globally during the past 100 years?
Did we get to the other side of those crises? Did we learn from them and come out stronger than before?
Are most of us currently having similar issues: fears, money problems, health concerns all at the same time?
Have we ever been more unified in trying to solve these issues?
Have governments ever had the ability and willingness to spend this amount of money (accommodated by central banks) in all of human history?
Have we ever had more technological knowledge and computing power than we do today?
Once again, I do not know how long this crisis will last, but I am fully confident that we will get through it. In the meantime, I wish you and your family the very best for a hopeful and peaceful future.
On the investment side:
The markets in aggregate are reducing risks substantially.
The markets have some liquidity problems, but they are functioning.
The FED is taking more unprecedented action almost daily.
The Government will get more aggressive in its spending over the next couple of weeks (yes I believe the politics will work itself out).
My thinking (for long term investors):
Look to accumulate assets where risk reduction has created extreme value opportunities
But, be patient in location over the next couple of weeks. We know the number of infections will rise and media focus may cause further negative feedback loop in the short term.
For signs that markets have seen the worst:
Watch for signs that companies and individuals are getting access to funding which will carry them through the next few months.
Watch for signs that the USA moves away from complete isolation for the whole population toward a more targeted quarantine of infected individuals
A big thank you for the many responses to my previous note. If you have time to send me your thoughts and/or comments, I really would appreciate hearing from you.
Best of luck,
Joseph Cardello, Principal
August Wealth Advisors
The Loft, 101 Franklin Street, Suite A
Westport, CT 06880
Direct (916) 461-9451 toll free (800) 985-9477
“Investment advice offered through Stratos Wealth Advisors, LLC, a registered investment advisor; DBA August Wealth Advisors.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. The economic forecasts set forth in this material may not develop as predicted and there can be no guarantee that strategies promoted will be successful. No reader should make any investment decision without first consulting his or her own personal financial advisor and conducting his or her own research and due diligence.”