Perpetually Looking Forward

If the US economy falls into a recession this year, it would be one of the most widely telegraphed, with over 60% of 70 economists surveyed by the Wall Street Journal in January predicting a contraction in GDP within the next twelve months. This is up from under 20% in January 2021. 

We are pleased to announce that Tom Morr, CFP®, CAIA and Wayne Yi, CFA, have been promoted to Partner effective as of January 2023. These promotions mark the first time since 2013 that an employee of the firm has been named Partner (3 strategic hires have joined Simon Quick as Partners since that time). 

The clients we work with often express a desire to give back to their communities by supporting charitable causes they’re passionate about. Establishing a private family foundation can be an effective vehicle to accomplish one’s charitable wishes.

You have no doubt heard the saying, “Don’t put all of your eggs in one basket.” This sums up the role of asset allocation when it comes to maximizing returns on your investments. Studies have shown that asset allocation, not security selection or market timing, is the main driver of investment returns over time.

The $1.7 trillion budget bill that was signed into law late last year included legislation affecting retirement savings for many Americans. Dubbed the SECURE 2.0 Act, this legislation makes a number of key changes to the rules governing popular retirement accounts including IRAs, 401(k)s, 403(b)s and Roth accounts.

2022 concluded on a positive note, with both equities and fixed income generating positive performance during Q4, despite a challenging year overall. While Central Bank action has been the primary driver of volatility and price declines in 2022, a slowdown in the magnitude of rate hikes and growing expectations for a pivot in policy in 2023 helped to drive markets higher. The S&P 500 advanced 7.5% during Q4, while the Barclays US Agg Bond Index was up 1.8%.

Investors over the past year have faced levels of economic uncertainty and market volatility that haven’t been seen in years. The S&P 500 index was down nearly 20% in 2022. Moreover, the index recorded 46 moves of 2% in both directions throughout the year, which is the choppiest performance the index has seen since 2009 – roughly four times the 10-year average.

The Global Financial Crisis gave structured credit a bad name. As a result of 2008, many investors believe the broader asset class contains unnecessary complexity and risk to warrant much attention. It’s true, subprime mortgages in mortgage-backed securities (MBS) and certain collateralized debt obligations (CDOs) led to extreme losses at the time, and while these structures grabbed the headlines, other structured products were resilient and performed well.