Perpetually Looking Forward

In this ongoing series, we are profiling some Simon Quick clients to reveal some of the financial and estate planning challenges faced by wealthy families and how we have been able to help them meet these challenges.

Equity markets have entered into correction this week with the S&P 500 falling over 11% year-to-date. This is being driven by two main factors: inflation and the anticipated Fed response of a more aggressive rate-hiking and balance sheet reduction program, and more recently the intensifying conflict between Russia and Ukraine that has turned into an invasion last night. We expect markets to further sell-off on this news today as the volatility index has spiked to 37, the highest in over a year.

Building a strong community through charitable giving is one of the tenets of American culture. In 2020, Americans made $471 billion in cash contributions to charity[1]. The vast majority of this money was given away by individuals — only about 4% was given away by corporations.

Cybercrime has been on the rise for years, but a variety of factors have resulted in recent spikes in cybercriminal activity. The pandemic is one of these factors. 

InvestmentNews has recognized Simon Quick Advisors as a 2022 Best Places to Work for Financial Advisors. Simon Quick was chosen as one of this year’s top-75 firms based on employer and employee surveys, evaluating company culture, benefits, career paths, and more.

Equities logged another tremendous year for returns in 2021, generating over 28% on the S&P 500, with a strong fourth quarter rally of 11%. We have seen significant resiliency in the index since the ’08 Global Financial Crisis. Even if you were to have started investing at the beginning of that year, which experienced a 37% decline, you would have annualized at an impressive >12% return to date. In fact, there was only one calendar year where returns were negative after the GFC (-4.4% in 2018), and only two other years (2011 and 2015) where returns were not in the double digits. It was easy to be an investor in this cycle. But…the Fed had been highly accommodative to risk assets during this time.

The pace of sell-off in equity markets accelerated today (Monday, January 24th), down almost 4% around lunchtime, on top of the 7.7% sell-off experienced in the first three weeks of this year. This move put equities formally in a stock market correction for the S&P, which follows the earlier sell-off in small caps and growth indices.

I was talking to a friend last week, and he told me about his daughter who is in her twenties and pursuing a career as an investigative journalist. The entry level salary she expects to earn would prohibit her from living in a doorman building in her city and he was concerned about her safety. He told me that he was considering supporting her, and that it was worth it to him to have her in a safe environment, at least until she progresses financially to a point where she can support herself.