July 23, 2024
“No act of kindness, no matter how small, is ever wasted.” -Aesop
“When you like a flower, you pick it, when you love a flower, you water it daily. One who understands this, understands life. -The Buddha
Give Without Counting the Cost
Perhaps it’s my age, perhaps its wisdom gained, perhaps its breaking free of my conditioning and upbringing, but whatever the reason I know this:
It is better to be kind and give to others without the expectation of anything in return.
Any worthwhile relationship ends up being reciprocal. It will produce a lasting benefit if it isn’t wasted.
Some of us approach life with a calculating and transactional approach to what we give others. Does the voice in your head ever say:
“If I do this for so and so, what will I get out this? What will this person do for me if I do this for them? Will I increase my stature in the community if I donate to this charitable cause? What does it matter if I put forth maximum effort in my job if I won’t be paid more for it? If my client doesn’t notice, why wouldn’t I put them into a higher priced product that makes me more money?
If the voice in your head is telling you to operate in this way, you are shortchanging yourself!
“We only get what we give”- The New Radicals 1998
“Life is richer when you don’t stress about what you will receive. You only need to think about what you are supposed to do, and how you are supposed to be. You can trust that all will work out in the end.” - Joe Cardello
Perhaps you might argue that I am a sucker for operating that way, and I will be taken advantage of. It happens. If someone chooses that path, what do they really gain? If they waste what we give them, we need to move ahead without them to ensure that our giving toward those in need continues unabated. If you haven’t read my commentary from March about the tale of two grandfathers, you may want to have a read of it. It details the importance of cutting off those that take advantage of others.
https://www.augustwealthadvisors.com/post/why- do-we-enable-bad-behavior
Thanking the People that helped show us the way.
At August Wealth, we have a desire to serve others. By reducing anxiety around money and investment decisions, hopefully the families we serve can utilize more time and energy toward what matters most in their lives. We are grateful to wake up every day using our skill and experience to serve others; it is very clear to us what we are supposed to do.
However, before August Wealth was founded, I was running the financial markets business in America for The Commonwealth Bank of Australia. I learned a lot, and it was financially rewarding, but it was not particularly fulfilling nor enjoyable. I knew I was providing for my family, but I was wresting with many personal emotions at the time, and I felt generally lost. What was my purpose?
Around this time, I was reading a book called “The Seven Storey Mountain” by Thomas Merton. Without getting into the details of Merton’s life, I was fascinated by his journey. From a non-religious background, he became a Trappist monk, writer and philosopher. I became interested in monasteries and how monks approach life within them. There are many still operating across the globe, and the tradition is approximately 1500 years old. Despite feeling a little strange, on one of my trips from New York to Sydney, I stopped over in Los Angeles for a night and stayed at a monastery in the high desert outside of L.A.
Whatever feelings of awkwardness I may have had dissipated quickly. You realize that a Benedictine Monastery is in many ways like a wellness retreat, except simple, cheaper, more peaceful, and full of monks with much wisdom. You can sleep, eat, hike, take books from the library, and not bother to interact with anyone. There was even a helipad (I suppose for some of the richer folks in need of a spiritual getaway). For me, I stuck with the non- interaction/silent observer for most of my 24-hour visit, but towards the end of my stay an older monk approached me and introduced himself. He was very soft spoken, gentle, unassuming, and interested in my story. His questions were probing but gentle, and he could see that I was struggling with something in my life. He inquired about my family, my background, my job, what books I was reading, and he listened in a way that staggered me. I will never forget how he was able to get to know the real “me” in a ten-minute conversation! I thought to myself, this monk seems to understand human nature better than anyone I’ve ever met. It was an astonishing conversation, and that 10 minutes of attention changed the course of my life.
There were many steps from that point, but a long friendship developed with my monk friend, Francis Benedict. Some of the attributes discovered and continually honed are reflection, perception, openness, gratitude, self-giving, focus, prioritization, listening, and knowledge. These attributes are the foundation of August Wealth and our culture.
Francis passed away on July 20, 2024, and the best way for me to honor him is to give the care and attention to others that he graciously gave to me. I thank my friend for making the world a better place through his interactions with others.
Asking the right questions, identifying potential issues and contradictions, and posing solutions.
We are doing mid-year reviews of your portfolios, the reasons for your investment mix, and our probability assessments for the future. Internally, the investment team has worked with the advisors on many topics and client questions. Three topics are listed below, but if you would like to hear about more, please give us a call.
1) We know that the S+P500 index is outperforming many other benchmark indices and asset classes globally in 2024. This has been highlighted ad-nauseum. Here are some appropriate questions to ask if you compare your portfolio to the S+P500 index.
Are you willing to own 100% stocks in your portfolio?
You are accepting the historic risk of a 30% or far greater loss on your portfolio in any given year (recently happened in 2022). Is that acceptable to you? History tells us that many investors sell in such events; would you be able to stick with your plan?
Are you willing to put approximately 1/3 of your wealth into roughly 7 companies? What if those companies do not continue to outperform in the future?
It is possible that other asset classes can outperform the S+P500 in the future; are you willing to accept that you may make less money than other asset classes?
2) There is a lot of talk and predictions in the media and financial markets around a Trump trade, deficits, inflation, the economy, tariffs, and the likely events that might occur. If you
are using this information for decision making, it’s appropriate to ask:
How confident are you in your ability to predict with certainty how markets will react over a long-term time frame with any of the above issues?
Do you believe that political pundits and market forecasters know any better?
Are you willing to bet your livelihood on these forecasts?
3) There is still a lot of marketing by private equity firms trying to raise money for investments. Before investing, consider:
Borrowing funds at low interest rates was a big contributor to returns in private equity as we previously identified in April’s commentary: https://www.augustwealthadvisors.com/post/lopsided-relationships
The Federal Funds interest rate for a good portion of the last 20 years was below 1%. Are you predicting interest rates heading back toward those levels soon?
If limited partners cannot be paid, might this create a problem for future fund raising?
If interest rates do not provide relief to heavily indebted companies, and cash flows of a business cannot pay, what will happen to these loans?
Outperformance is essential to justify such high fees. Are you confident enough in their ability to outperform?
The above are just some of the topics that have come up, and the questions you should consider when addressing. To me, it’s important to ask the right questions, understand what you are trying to solve for, formulate a strategy, and execute the plan.
Then you have a reasonable chance at not reacting to your emotions of fear nor greed. Instead, you will follow a process that seeks to achieve long-term growth of wealth and protection of your wealth.
Please give us a call if you would like more specific information around the companies, sectors, assets and countries you’re invested in. We are always happy to hear from you, and to hear your point of view.
Thank you.
Joe
i Investment advice offered through Stratos Wealth Advisors, LLC, a registered investment advisor. Stratos Wealth Advisors, LLC and August Wealth Advisors are separate entities.
Trading instructions sent via email, fax or voicemail will not be honored. There is no assurance that these messages can be retrieved on a timely basis, nor is there any sure method of confirming the customers identity.
The information contained in this email message is being transmitted to and is intended for the use of only the individual(s) to whom it is addressed. If the reader of this message is not the intended recipient, you are hereby advised that any dissemination, distribution or copying of this message is strictly prohibited. If you have received this message in error, please immediately delete.
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 financial advisor and conducting his or her own research and due diligence.
The opinions and information contained herein have been obtained or derived from sources believed to be reliable, but
August Wealth Advisors makes no representation about their timeliness, accuracy or completeness. Content in this material is for general information only and not intended to provide specific investment advice or recommendations for any individual. Investing involves risk including possible loss of principal.
Comments