Tax rates and mortgage rates are both on the rise. For some investors, these shifts may indicate negative trends for market prices and economic growth. If we zoom out for perspective, history tells us that these increases may not be such a bad thing.
Many industries have been unprepared for rapid surges in demand caused by the pandemic. Notably, the lumber and microprocessor industries find themselves rationing scarce quantities through higher prices.
One method of gaining perspective when faced with overwhelming data is to zoom out and understand how recent activity fits into a larger pattern. By doing this, we can gain a better understanding of the ‘relative progress’ during the pandemic versus the ‘absolute progress’ over a longer timeframe.
Cryptocurrency is an evolution of money that currently hinges on its ability to solidify widespread trust in its functionality as a store of value and a medium of exchange. Trading platforms like Coinbase may add legitimacy and security to ownership of cryptocurrency.
Q1 2021 Market Commentary
In the current pattern of growth, interest rates are likely to be volatile while both production and employment are recovering, and equity prices are likely to behave in kind.
Traffic on the Suez Canal is fully halted in both directions after the Ever Given became lodged in the embankment. Fascinating as it is, the bottleneck and the slowdown that it’s caused will ultimately be a short-term detour in the long-term trajectory of global trade.
The potential for blockchain as a technology is easy to recognize. Much harder to know at this point is how that potential will be applied.
Rising interest rates are a natural process in the re-opening of the economy and show that the market relationship between stocks and bonds is normalizing.
Inflation and the upward trajectory for interest rates are a healthy sign for our shared economy and the long-term investor.
Complex systems like energy grids or financial markets aren’t perfect, but they are designed to be resilient. When catastrophes happen, resiliency matters more than perfection.
Covid-19 could shift from a pandemic disease to an endemic one. Businesses understand this shift and new and potentially lucrative Covid-19 business lines are quickly emerging.
The market gyrations caused by the bizarre and meteoric rise of GameStop stock illustrates the sharp contrast between short-term trading and long-term investing.
The arc of change bends towards justice but it isn't guaranteed. It requires hard work and tireless effort stretching across generations.
Q4 2020 Market Commentary
As we enter 2021, we expect to encounter potholes as well as progress, with an uneven path to global economic recovery over at least another year or two.
Vaccine rollout and increased spending on green infrastructure may make 2021 a much more positive year economically than 2020. Whether or not stock prices have further room to rise in the near term, is yet to be determined.
2020 brought dramatic change to our daily lives and prompted adaptation in many industries. Although 2021 will probably not be a smooth ride, progress will be the main theme.
The growing role of technology in recent decades has expanded a new frontier of risk for companies and individuals alike: cybersecurity. Ironically, we refer to an invasive computer code as a virus.
All decision-making, in investing and in life, is made with partial knowledge. It is important to find the right balance of potential and security so that we can have peace of mind in the moment.
The vaccine announcements provide hope for the resumption of robust economic activity, but the market and the country will need to navigate a hard winter before the distribution process is functionally underway.
We believe a new phase of market growth will result from adaptation as we enter a new economic landscape.