Perspectives

After listening to Governor Newsom’s “stay-in-place” decree last night, we had a lengthy discussion about the impact of a total lock down on California, the market and our expectations for it. During that discussion, we talked about the emotions elicited by both market gains and market selloffs. A key observation was that it easy to buy into a jubilant market, but it can be difficult to remain invested during a significant market draw-down. Below is a chart of the Dow Jones Industrial Ave… View More

We spent last week warning policymakers about the urgency and magnitude of the economic fallout from the coronavirus. To be fair, Congress will always lag market participants, and politics constrains a quick response. But the gap was so wide between financial market participants and policymakers that we were deeply concerned. Exactly one week ago today, the consensus view in Congress was to take a wait-and-see approach. But as we all know, once the slowdown hits the data, we are too late. Financ… View More

Markets across the globe sold off last week as the coronavirus spread to over 125 countries and oil prices reflected last week’s failed OPEC+ negotiations. The markets gyrated wildly last week: for example, the Dow Jones Industrial average lost 2,013 on Monday, gained 1,167 on Tuesday, lost 1,464 on Wednesday, lost 2,352 on Thursday and ended the week with a 1,985 gain on Friday. Thursday’s selloff was the worst since October, 1987. Last week, all of the major indices entered a bear market (… View More

There are a couple of topics we want to discuss this morning; the risk of market timing and the Fed's actions overnight. With respect to market timing, we understand the temptation to try to time the market, but moves like Friday's help demonstrate exactly why we should not. There will be up days and up periods that investors will miss, and missing those periods will have a negative impact on investor returns. In looking at the last 25 years of the market's data, we found that if an investor ha… View More

We wanted to take this opportunity to say thank you for your continued trust in our firm’s Intellectual Capital. Even though we have never been through this type of scenario before, we remain confident that we will get through this and will have a V shaped recovery once we get some clarity on the virus and its effects on the economy in the short-term. We would like to let you know that since the day we founded Fortem, we have built a very robust Technology platform that will allow us to work r… View More

We continue to hear that the world has NEVER known something like the Coronavirus pandemic, so we decided to do some digging to see what we could find. Interestingly, the first thing we came across was the "H1N1" flu virus. You can access the information yourself from the CDC's website following this link if you would like to: https://www.cdc.gov/flu/pandemic-resources/2009-h1n1-pandemic.html We quote from the CDC, "In the spring of 2009, a novel influenza A (H1N1) virus emerged. It was det… View More

Yesterday was a hard day in the market; some may even contend the market has "never been this bad." But that would be our emotions speaking, and it would be factually incorrect. The S&P 500 was down 9.5%, a far cry from the 22.6% it lost on Black Monday - October 19, 1987. We only bring this up because we believe it provides perspective. It is easy to allow ourselves to believe that the current conditions are the WORST that have ever been. Time (and gains) heal old wounds in the market. The… View More

As many of you know, we have been following Bob Doll for over 20 years now. He put together a list of 10 things to consider during this Coronavirus outbreak. We thought it would worth your time to read his comments, which we have copied below. From his comments, we want to point out the underlying strength in the economy. While we will only know the full extent of what the Coronavirus will do after it is done, we do know that the US economy was about as well prepared for this as one could hope. … View More

We understand the level of fear associated with both the Coronavirus and the market's sudden drop over the last few weeks. Further, we understand the feeling that this is a "new" crisis, the likes of which we've never seen before. In reality, Coronavirus is a new crisis, but that was also true of every crisis we have ever seen. We have been doing this a long time, and we have seen many crises come and go, each of them "new" and "unprecedented." In 1997, we faced the ASIAN FINANCIAL CRISIS. Debt… View More

Over the last few weeks, we’ve heard the comment a number of times that “the world has never seen something like Coronavirus,” and the reference is in relation to more than just the spread of the virus. The reference has been in relation to the market’s movements and to the economic impact the virus will take on the global economy. The genesis of these comments could be a variety of things. We have seen both record daily losses and record gains in the stock market. We have seen the swif… View More