Terry Sawchuk Founder & Chairman
Is it me, or is this the most hated bull market in history? It really does make a difference as to where you get your information, and in particular, how that information is presented. Our profession is such that we need to pay attention to the popular finance outlets. Needless to say, if you’re getting your updates from CNBC or some of the other popular financial news networks your picture of the current economy and stock market might not line up with what’s really going on.
Regardless of where you stand on the political front, we are firm in our conviction that politics are best left out of investment strategy and decision making. Obviously, the exception to that would be actual tax-policy or regulation that is enacted and has to be considered as part of the overall plan, but that’s where it should end. Anticipating future outcomes because one doesn’t like, or the opposite, loves, the particular political aspect of possible legislation or other political machinery is a fools game. A perfect example is unfolding right in front of our very eyes. The current bull market is easy to overlook, diminish or even flat-out deny because one either doesn’t want to believe it, or is being fed information that would suggest that the market is vastly overvalued or ripe for a significant decline. The actual data simply doesn’t bear that out.
In a recent video produced by First Trust Portfolios, Brian Wesbury does a terrific job of addressing this very topic. If you are interested the link is here: http://www.ftportfolios.com/Commentary/EconomicResearch/2017/4/19/trumponomics-and-stocks. He points out that if you simply look at what has been driving the economy, it has been innovation and entrepreneurship. He cites examples such as fracking, apps for your phone and computer, cloud computing and other brilliant ways innovators in our economy have pushed growth. We believe he’s dead on. Furthermore, all you have to do is look at the numbers. S&P earnings growth hit double digits in the first quarter of 2017 for the first time in years. Overall, the economic data was strong in January and February and a little lighter in March. There are reasons for the modest slowing of certain areas of the economy in March, but it warrants our attention. It is our view that continued decent growth is ahead, and depending on whether tax-legislation is passed, possibly more robust growth. As we mentioned earlier, we are setting politics aside and looking at the facts. The fact is, while tax legislation is being discussed and considered, it is not currently in place, and until it is it has no impact on our over portfolio management.
In general, we believe our portfolios have been, and continue to be properly positioned given recent performance and our expectations regarding the direction of economic growth. We cannot stress enough how important separating politics from investing is for the success of any investment venture. It is always best to look at the raw data and draw your own conclusions, or hire someone like us who does exactly that.
In the meantime, we are collecting all kinds of data points and objectively distilling it for the important takeaways. One obvious takeaway, the weather lately has been pretty lame and we are hoping for a turnaround story in the very near future. If you’re one of our more fortunate clients who happens to live in a warm weather climate, you can simply disregard this last piece on continue on with your merry ways.
As always, we take very seriously your ongoing trust and confidence and you can rest assured that our team is working very hard on your behalf. Speaking of our team, we should mention that our long-time assistant Melissa Orzechowski was offered a great opportunity at very large defense firm that we urged her to take, it was the right thing for her and her family. That leads us to the introduction of our newest staff member, Tiffany Sawchuk (there may be a connection there) to Sawchuk & Langenstein Wealth Strategies. Tiffany is a very recent graduate of the University of Michigan (as of last Saturday) is eager to get to work on your behalf. Again, thank you for your ongoing trust and confidence.
Visit www.sawchukwealth.com to review past issues of The Marketview.
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