Category Archives: Monthly Commentary

“A Fresh Pair of Eyes”, “Always Late”, and “Times They Are a Changing” – Nvest Nsights Q3 Newsletter

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We hope this note finds you and your family well and enjoying the beginning of Fall.  Unfortunately, “enjoyable” is not a word we’d presently associate with the financial markets.  The 3Q marked the first time since 1976 where both stocks and bonds were simultaneously negative 3 quarters in a row.  As we interact with clients, some jokingly request that we not send this quarter’s update as they are doing their best to not focus closely.  That may not be the worst strategy!

Our newsletter this quarter includes the following brief perspectives:

  • “A Fresh Pair of Eyes” – 2022 remains all about rates (interest & inflation), and the dynamics are very different than when the year began.
  • “Always Late” – What’s it like to always be late?  Maybe we should ask the Fed.  Recognizing that monetary policy always acts with a lag, it is understandable the market is concerned by the aggressive changes pursued over the last 9 months.  Will the Fed go too far before we see the impact of their actions?
  • “The Times They Are a Changing” – What’s the market saying about the future; what can help the markets stabilize and ultimately turn the negative trend around?
  • “Buckets of Time – Dead, or Alive?” – With bonds experiencing their worst stretch in over 40 years, some may be wondering if the “buckets of time” approach remains appropriate in today’s environment.

The printer-friendly version of the newsletter, including benchmarking and widely held fund performance data, can be obtained here: printer-friendly PDF version.

With so many issues affecting the current investment climate, we hope that these updates are helpful.  Please do not hesitate to call, email with questions, or to coordinate a time to visit together.

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Behind in the Count – September Commentary

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Challenges exist for anyone playing sports when they are “behind in the count.” It’s a common experience for all athletes. Pressure builds for example, when batting with a count of “no balls and two strikes”, or behind in the football score 21-0. No competitor likes being behind, and extra effort may be pursued to bring about a positive winning outcome. Competitors strive for opportunity to succeed. Isn’t that the way with most things in life – pursue success, not failure?!

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Navigating – August Commentary

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GPS (Global Positioning Systems) offers us so much information about our surroundings and position in our world.  On a recent vacation, we used the Navigate button in our Tesla to direct us efficiently to charging stations to help us reach our goal, home.  The system calculated, like an aeronautical map used in aviation, our route with points of interest, neighborhoods, and terrain.  It took a few moments as it planned our route to avoid heavy traffic, road construction, and other hazards attempting to ensure the car would have ample charge to reach the next point – charging stations and ultimately home.  As we set off, the little red chevron that represented our car began following the planned route inching from right to left across our screen traveling west, north-west.  The map was laid out in the standard position with North locked at the top.  Our little chevron traversed across the fixed screen.   I’m not fond of that traveling presentation.  So, I pressed an icon on the top of the screen and suddenly our little chevron was fixed in the center pointing up (forward) as the map turned and moved under it!  [Being simple minded, I prefer the chevron pointing the same direction as the car is traveling.]  Which way was north, south, east west?  Did I care?  Cities, roads, and the world revolved around me!  My real concern was that we were generally traveling west, north-west toward our goal, home.

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“GIGO”, “The World Changed”, and “Bills to Pay” – Nvest Nsights Q2 Newsletter

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We hope you are enjoying summer and sunshine.  Unfortunately, the financial markets remain stuck in a “storm”.  After the difficult first quarter, pain accelerated during the 2Q.  There was no place to hide; bonds and stocks together experienced a 2nd consecutive negative quarter each – a somewhat rare occasion.

Against this backdrop and with so many big worries without easy or quick resolution (inflation, Russia/Ukraine, Fed that is intentionally trying to slow the economy to balance supply & demand), it can become challenging to maintain a longer-term perspective.  Our newsletter this quarter provides the following context:

  • “GIGO” – Do your best to control the type of information you consume, as well as how you react to it.  What version of “GIGO” will you be?
  • “The World Changed” – A review of market action so far in 2022 and context from history providing clues to what might be expected from here.
  • “Bills to Pay” – The “cost” of fiscal and monetary stimulus pursued by governments around the globe in response to the Great Lockdown is being paid in 2022.  How is the bill being paid and how long will that last?
  • “iPod, iPhone, iPad… now the I Bond” – What are I Bonds, and are they for me?

A printer-friendly version of the newsletter, including benchmarking and fund performance data, can be obtained here: Q2 Nvest Nsights.

We realize how troubling is the current market environment and are here for you.  We continue to monitor the backdrop, and be intentional about managing portfolios tactically.  Please do not hesitate to call, email with questions, or to coordinate a time to visit together.

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Bowling Bumpers – June Commentary

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“Chloe and Miles grew up between the same bowling bumpers that encouraged risks, inflated confidence, and prevented consequences.”  The quote is from “Rock the Boat” by Beck Dorey-Stein.   Ever bowled where bumpers are placed in the gutters on each side of the lane?  Rolling a gutter ball is not possible.  This makes bowling fun for young kids and new bowlers.  But, this concept is dangerous in real life – putting up “fake” guardrails to prevent bad outcomes; then when the trouble occurs, extending “forgiveness” without consequences.  The same concept can occur in life when we are allowed to enjoy our “kicks.” But when the “bumpers” are removed, unwelcome “kickbacks” can occur.  When my boys were growing up they were cautioned, “You can choose your kicks, but you cannot choose your kickbacks.”

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Double-Barrel Shotgun – May Commentary

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The rivalry between the Hatfields and the McCoys is one of the oldest and best-known family feuds in American history.  For nearly 50 years, violence between the two families raged over who owned two razor-backed hogs that swam in the Tug River, a valley area between Kentucky and West Virginia.  Even though the feud ended in 1891, they finally shook hands in 1976; a truce was signed by the families in June 2003.  With a total of 60 deaths between both sides, it’s questionable that either won.  The Hatfield-McCoy legend was embellished by a brief love affair between Johnse Hatfield and Rose Anna McCoy.  Not sure if it was true or not – as a double-barrel shotgun is seldom able to bring sweet marital bliss!

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“Goes Without Saying” and a “Stitch In Time” – Nvest Nsights Q1 Newsletter

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After nearly two years of strong market gains, investors experienced their first meaningful pullback during the first quarter of 2022.  While it is typical for markets to experience pullbacks and a higher level of volatility after the initial 12-18 months of a new bull market, it is never welcomed or comfortable.  That is probably because the uncertainties that usually accompany them are always unique.  Present uncertainties include a still fractured global supply chain, a Federal Reserve that finds itself needing to raise interest rates and tighten monetary policy in pursuit of arresting inflation that is running at the hottest pace in 40 years; and of course Russia/Ukraine which muddies both challenges further.

This quarter our Nvest Nsights newsletter shares what we’re watching and perspective to the topics/questions we’re most frequently hearing from clients.  Perhaps it “Goes Without Saying” that the backdrop highlighted above implies 2022 will likely remain a challenging year; but there are also some important messages to be heeded from history.  There is also the saying that “A stitch in time saves nine”;  while ‘main street’ consumers may not welcome rising interest rates and the impact on the cost of borrowing (or the markets in the short term) it is nonetheless appropriate for the longer-term health of the economy.  The markets are adjusting to a changing investment landscape.  We close the update with our personal finance theme article with a change coming to employer 401k statements this year.  Will the new “Lifetime Income Estimates“ being provided help you feel more secure?

A printer-friendly version of the full quarterly newsletter, including benchmarking and fund performance data, can be obtained here: Q1 Nvest Nsights

As always, please do not hesitate to let us know if you have any questions or would like to coordinate a time to visit.

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Turn! Turn! Turn! – March Commentary

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“Geopolitical conflicts and/or exogenous events do more to reinforce trends already in place, rather than act as a catalyst for change (in the markets) – Strategas Research Partners.”  Gold is rallying; oil is in a bull run higher; value style is besting growth while Tech is a pronounced underperformer.  And Bitcoin –who’s strongest advocates claim it to be an alternative currency – is yet to offer any hedge or stability to risk assets.  These trends don’t change (because of geopolitical issues), just the urgency of them.  The horror and uncertainty of the Russian/Ukraine invasion is extreme; it is terrible, inappropriate, and immoral. It is most challenging to offer thoughts on how it will play out, as no one knows.  We can pray that it is a temporary geopolitical event which will hurt Russians economically, and will slow Germany and Europe economies (to a lesser degree), and will marginally slow other global economies depending on their connections to Russia/Ukraine.  At present, the US bond market is functioning normally (unlike March 2020 when COVID hit and the Great Lockdown was initiated).  There is increased volatility in all markets, but there is not dysfunction.  There is the normal, predictable flight to safety.  Please read our Special Market Update, “Market BUMPS to Climb On” from February 23 on our website, at www.nvestwealth.com.Continue reading→

There’s Plenty More – February Commentary

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We occasionally hear this idiom:  “There is more where that came from.”  It can be used in a negative, combative sense or in a positive, generous way.  The statement may be offered to a belligerent child – “if you do not shape up, there’s more to come.”  Alternatively, where there is strong achievement more success often follows.  In both cases the meaning is the same:  there is a reservoir just waiting to be tapped if needed.  Another famous statement:  “the barrel is only half full; or the glass is half empty.”  As we pass through 2022, will there be more market advance (from which it came), or are investors expecting the success to evaporate?  Is the longer market up-trend still viable, or are the short term worries about “everything” (inflation, interest rates, Russia/China/North Korea, oil, COVID variants and living life again) emptying investor sentiment?  How much more is to come – plenty more (of what)?!

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“Lowdown on 2021” and the “Journey into ’22” – Nvest Nsights Q4 Newsletter

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Happy New Year!  2021 provided a second, actually a third, consecutive year of double-digit investment returns for stocks (most forget 2019 because of how quickly the mood soured in early 2020).

This edition of our quarterly newsletter, Nvest Nsignts provides “the lowdown” on what themes drove the financial markets during 2021.  Perhaps of greater interest is our sharing of what we believe will be the biggest focus for investors as we “Journey into 2022“.  Our personal finance focus this quarter, “Healthy Habits” shares several easy-to-implement “resolutions” that can pack a powerful punch to enhance your long-term financial posture as you set plans for the New Year.

A printer-friendly version of the full quarterly newsletter, including benchmarking and fund performance data, can be obtained here: Q4 Nvest Nsights

As always, please do not hesitate to let us know if you have any questions or would like to coordinate a time to visit.Continue reading→