What We Are Seeing & Thinking
Here we are, on the other side of one of the ugliest political seasons we’ve seen in recent history. It’s now time to count our blessings and take stock of the year that will be quickly behind us. We thought this was a good opportunity for us to reach out and let you know what we are seeing and thinking right now.
Politics
With two fairly unpopular candidates, both for different reasons, we did not feel the presidential election was the most important to watch. We are far more interested in what we saw happen at the state and local levels. With polls projecting a “blue wave,” we are pleased to see a divided government. While the presidential election went blue, republicans gained unexpected seats in the House and are expected to maintain the Senate after January’s runoff elections. Many other state and local elections went to republicans showing a clear disapproval of the extreme, socialist thinking of the far left.
As a result of this divided government, both political parties have their hands tied. Republicans, losing the president, are now forced to compromise with democrats if they hope to see any advances in their agenda. Democrats, after losing unexpected seats in the House and receiving a clear message that some of their extreme views are not representative of the overall party, will be forced to play to the middle if they hope to keep the House in 2022. We are hopeful this division will lead to great compromises in the coming years.
Covid-19
With numbers on the rise, there is still a lot of fear surrounding the Covid-19 crisis. While we are certainly not out of the woods, we are starting to see glimpses of our normal lives on the other side. Death rates are moderating as healthcare workers are developing and discovering new treatment methods. Both Pfizer and Moderna have released promising vaccine results that could begin distribution by year end. We see this as a very positive step in the right direction.
Markets
It is important to remember that the stock market is a discounting mechanism. It is operating on expectations months in advance; so, while we find ourselves in the midst of a “second wave” of the virus, the market is looking ahead to the promise of a vaccine, better treatments and normalization of life. As always, we tend to be skeptics and play on the conservative side, and thus we feel this is a very important time to reassess your personal financial goals. We’ve seen a volatile year and that volatility tends to bring out our true risk tolerance as opposed to how we would classify ourselves during up/stable markets.
We would not be surprised to see a continuation of this volatility and temporary market and economic uncertainly in the near future. If you have concerns or if you feel there have been changes in your overall goals or risk tolerance, we strongly encourage you to call.
We hope you enjoy this wonderful time of year. Although it may look different than past holiday seasons, we are giving thanks for the many blessings 2020 has brought us.
The information contained in this blog does not purport to be a complete description of the securities, markets, or developments referred to in this material. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. This information is not intended as a solicitation or an offer to buy or sell any security referred to herein. Opinions expressed are those of the author and are not necessarily those of Raymond James. All opinions are as of this date and are subject to change without notice. Prior to making an investment decision, please consult with your financial advisor about your individual situation. Investing involves risk and investors may incur a profit or a loss. Past performance is not a guarantee of future results.
