Quarterly Newsletters

As we enter the final quarter of 2020 many of us start to think of year-end charitable giving. Despite a difficult year for the economy and wild stock market swings, preliminary data from Fidelity and Giving USA suggest that Americans have stepped up their philanthropy, increasing donations by almost 16% so far in 2020. Perhaps that should not be surprising, as it turns out America is the most generous nation when it comes to charitable giving. Per Philanthropy Roundtable, annual private philanthropy in the U.S. represents almost 1.44% of GDP This is twice as high as the 0.77% recorded in Canada, nearly three times as high as the U.K.’s 0.54%, and in stark contrast to China’s 0.03%.

Vice President Joe Biden says the coming election is a “battle for the soul of the nation.” President Donald Trump has declared this the “most important election in U.S. history.” Perhaps. Or perhaps the nation’s deep partisan divide is just the way the world goes ‘round. Maybe, as John Prine suggests, we’re extrapolating out the worst-case scenarios because that is human nature.

The second quarter was marked by a global pandemic, a largely paralyzed global economy, racial tensions that boiled over into violence, heightened political discord, record jobless claims with 40 million people unemployed, continuing business failures, geopolitical tensions with Hong Kong largely being subsumed by China, locusts in India and Pakistan that could result in famine, and even murder hornets in the pacific northwest. So, of course, the stock market rose, posting its best quarterly performance in over 20 years.

Making and saving money is hard. Perhaps that is why human beings are wired to look for bargains. We’re constantly looking for sales, coupons, rebates, and discounts. It feels better to know you didn’t overpay for something.

When the CARES Act was signed into law on March 27th it suspended Required Minimum Distributions (RMDs) from Individual Retirement Accounts (IRAs) for 2020. It also allowed account holders to redeposit any prior distributions up to 60 days from the date of withdrawal. This was good news for many, as it potentially meant a lower tax bill for 2020 since there could be less reportable income.

Investment performance needs to be put into context to be truly meaningful. For example, assume you earned a 10% return over some period. Is that good? It seems so at first, but what if all your neighbors got returns of 11%? Or, what if the overall stock market was up 15%? The same return can look different under different assumptions.

Our newest team member is Kim O’Brien. Kim will be helping with reception, account maintenance, cashiering requests, and other service-related duties.

Our discussion of the capital markets for the first quarter could be quite brief: it was bad. However, there are some interesting sound bites worth noting:

Factor-based investing, or what has become known as “Smart Beta” is a strategy that has been prevalent in academic and larger institutional realms for many years. However, it is just recently trickling down to the investment advisor and retail investor world.

Relief for some is on the way. As during most times of economic stress, our elected officials are racing to roll out multiple programs to help reduce the financial impact to businesses and individuals. Here are a few provisions that have been put into action that may be of help.