Market Musings

June 2017

“Bull Markets climb a wall of worry” is a famous Wall Street proverb that dates back to at least the 1950s. As we near the midpoint of 2017, we can point to the recent terrorist attack in London, the North Korea threat, Russia’s alleged meddling in our election, and yet the domestic stock market is hovering around all-time highs. We remain committed to our long term investment principals of investing in high quality diversified portfolios and believe the economy is showing real strength in the face of these headwinds. That being said, we are cognizant of the lofty valuations assigned to many of the investment opportunities we follow and the now extended duration of the current bull market, and we have been making adjustments to our strategies accordingly.

Given the recent controversies in the White House, we have significant concerns over the ability of the administration to pass any sort of meaningful tax reform this year.  Due to the tepid (at best) response to the Trump tax proposal announced in April, we believe there would need to be significant changes made to gather the support of even the Republican Party, let alone the Democrats.

The next FOMC meeting is June 13-14 and was widely expected to result in an interest rate hike. Recent economic data has cast some doubt on that and we would now call it a toss-up as to whether the Fed will tighten this month. Rates are still artificially low and we don’t believe that another hike or two this year would impair the economy at all.

We have also taken note of the relative strength of the international and emerging markets. We believe this could be the start of an overdue period of outperformance relative to domestic equities and have been making some strategy adjustments accordingly.  That’s it for now – enjoy the summer!



Investing in foreign securities presents certain risks not associated with domestic investments, such as currency fluctuation, political and economic instability, and different accounting standards. This may result in greater share price volatility. These risks are heightened in emerging markets.

The report herein is not a complete analysis of every material fact in respect to any company, industry or security. The opinions expressed here reflect the judgment of the author as of the date of the report and are subject to change without notice. Statistical information has been obtained from sources believed to be reliable, but its accuracy and completeness are not guaranteed. The material has been prepared or is distributed solely for information purposes and is not a solicitation or an offer to buy any security or instrument or to participate in any trading strategy. Additional information is available upon request. Asset allocation and diversification cannot eliminate the risk of fluctuating prices and uncertain returns nor can they guarantee profit or protect against loss in declining markets.