Market Commentary for the week of August 3, 2020

Century

In the wake of last week's cache of economic announcements (historically unprecedented contractions in GDP, employment, Fed stimulus) we have an immense challenge to realign our perspective about that which ultimately makes for good investment outcomes.  The Covid virus respects no borders or ideology so our solutions, similarly, must be borderless, aggressive, and comprehensive.  Yes, we need immediate responses to these crises, but we also need thoughtful, fact based, strategic forecasting.

The world is moving at such an accelerated pace, it seems, that “yesterday's news” often becomes obsolete by sunrise this morning.  But consider that prudent investing takes into account cycles which traverse longer than just 24 hours.  For example, name any business that functions purely on a “24 hour business plan”.  While custom dictates that performance be reported every quarter (3 months), even that schedule is too compact.  What would happen if we elongate the performance metric to “every 100 years”?   Things were completely different a century ago, and will be a century hence.

Look around.  One hundred years ago there were fewer automobiles and airplanes; the palette of life saving pharmaceuticals available was slight; we used Morse code, telegraph, and regular mail to communicate; women had no vote; there was no television; agriculture was a generational, family owned endeavor; education was strictly a brick and mortar experience; the world was at war; there was a global pandemic.

With the exception of war and pandemic, most everything is different today, and will be different 100 years from now.

It's no mystery that if we were to build an investment portfolio that plans thoughtfully for the future rather than just maintaining the status quo we should reasonably expect profitability and growth.

To be precise, there is no doubt that cycles come in all durations…long, short, intermediate…just as investors come in many iterations.  Losing the leverage that day-trading accords is not a consideration for many of you.  Instant gratification and message processing is the future.

But just for purposes of illustration, let's accept that the compression of our attention span and the overstimulation of our information receptors has also made for a wildly turbulent marketplace, not to mention inordinate consternation, tension, and panic .  After all, that which distinguishes us as adults from children is our ability to lend perspective, insight, and rationality to things which otherwise might provoke emotional, irrational outbursts.

Look, I'm no novice to the investment game.  But the difference between casino gambling and investing is perspective, methodology, and time.  Many of the things we think we desire from Wall Street are actually induced by peer pressure, hyperbole, and well-produced television commercials.  Investing is a noble obsession, if done with social consciousness and shared responsibility.

In 100 years we could

.....clean our air and oceans

.....eliminate hunger and poverty

.....travel extra terrestrially

.....raise children to be loving and color blind

.....eradicate cancer and other deadly diseases.

Most of these things are "investable assets" we should be planning for and implementing in our lives today, Monday, August 3, 2020.