Market Volatility - March 11, 2020

Over the last several weeks, the market has become very volatile as the effects of the Covid-19 virus become more widespread.  The primary reason that we are seeing significant short-term swings in the market is the uncertainty of how this will affect our health and from an investment standpoint, how this will affect our economy and the companies that we are invested in. 

As you are well aware, I have no medical qualifications to talk about the health effects of the virus.  However, I believe that many of us will not have to worry about catching it and if we do, we will be able to survive much like most of us would survive a bout with the flu.  As the medical experts say, if we are diligent with taking precautions; proper and thorough hand washing, staying away from sick people, limiting our touching of our eyes and nose and mouth - we won't be affected personally by the virus.

Certainly, for all who have investments, we are being affected by the markets and their volatility.  Just like the headlines during the Dot Com bust of 2000 through 2002 and the Real Estate and Financial Crisis of fall of '07 to spring of '09, these headlines can be very frightening.  At this time, there is no way to know how deep the drop will end up being because of this situation, however I believe that a focus on your individual timeline and goals can help you keep perspective.  My belief is that prior to the virus, the economy and the markets were strong.  There are certain areas that will take a hit and have a drop in business; airlines, cruises, convention businesses & theme parks. And other areas of the economy might benefit from it; food delivery services, video rental companies and online meeting providers.  I believe that 2 or 3 quarters from now the effects of the medical issue will be under control.  I believe that in 2 to 3 quarters the effects on the economy will be sorted out, but that does not mean every stock will be at the same level it was at prior to the virus outbreak.  All of us control how this affects us by making wise investment decisions and not making emotional ones.  If you have several years until you plan on using the money, now is a time to add to your portfolios with a steady consistent stream of purchases like we already do through salary deferral contributions.  If you can afford to increase those contributions now would be a great time to buy more shares as the prices become cheaper.  Increase from 5% to 6% or 7%, from $100 per week to $125. 

If you are currently in retirement and taking income from some or all of your investments, please know that many of those sources of income payments are not directly linked to the stock market.  In many cases where money is invested in stocks and income is being taking, we have used guaranteed* lifetime income annuity products.  Another major source of income are income-producing bond funds that are designed to provide a steady stream of income regardless of swings in the stock market.  If you have concerns about the structure of your income payments, please reach out to us and we will review your current situation.

If you are not sure about how much to have invested in stocks or how much risk is right for you, we have a tool that will help identify your appropriate level of risk.  Just reach out to Michelle or Elyse and they will send you an e-mail with a link to a questionnaire that will start the process of identifying your risk score.  We are here to help with any questions you may have!  I will close with a quote from likely the greatest investor ever, “Be fearful when others are greedy, and be GREEDY when others are fearful!”  Warren Buffett!

Readiness - March 19, 2020

As we continue to monitor the Coronavirus (COVID-19), I believe it is now time for me to address the impact of the virus with you today.  Benoit Financial Planners will remain open but at the same time steps have been taken to minimize impact to you, our employees and the community. 

Our goal is to both maintain the health of our clients and employees while ensuring that we continue to deliver the service you have come to expect.

As a company, we have been following the CDC's recommendations to prevent the spread of the virus to ourselves and others.  As it is believed that the virus spreads mainly from close person-to-person contact, we are taking the step to decrease the need for clients to come into the office.  If you are scheduled for a face-to-face meeting over the next few weeks, we will contact you to offer you the opportunity to switch that appointment to a phone call. 

In the case you are still planning on coming into the office and you should feel under the weather, please stay home and we will reschedule your appointment. 

Also, I have stayed in close contact with Cambridge, our broker-dealer, and they too have a business contingency plan to continue operations as usual, even in the event of a quarantine.

We will continue to monitor this evolving situation and keep you informed of future updates.   

*guarantees are backed by the claims paying ability of the issuing insurer



Epidemics and Stock Market Performance - March 20, 2020



Weathering the Storm - March 27, 2020


Over the past several weeks we have all personally experienced the response to the coronavirus.  Store shelves have been bare, social interaction is being minimized causing schools to switch to virtual or remote learning and some businesses have been forced to close.

As many of you know, we are furiously monitoring data and information and participating in many conference calls and webinars to gain as much insight as possible on current events.  I wanted to share some of our findings, as I believe the more information that you have available to you the easier it will be for you to make educated decisions about your current situation.

I will address the 2 major components of the current crisis, which are the virus itself and the economic, governmental and market reactions to the virus.


There is now enough data from other countries to prove that the coronavirus IS NOT spreading exponentially.  It is following Farr's Law of Epidemic—like other viruses.  Farr's Law states that epidemics tend to rise and fall in a roughly symmetrical pattern that can be approximated by a normal bell-shaped curve.

  • We know from China, Japan and South Korea that the peak in new cases is between 3-4 weeks of time. 
  • Even Italy is showing that there is a slowing of new cases, hence following the bell curve.
  • Here in the United States, many regions are likely to follow their own bell curve.  As we originally saw Washington state as the hot spot early on, New York is currently facing significant increases in positive tests.

Due to the fact that testing has increased, we have seen a rise in the number of confirmed positive cases.  Many of these people likely had the virus previously but weren't tested at the onset of their contraction of the disease.

Testing is key to tracking the virus because the numbers will give us certainty about the trajectory of the virus and where we are on the bell curve.  This information will help governments make decisions about reopening businesses.

The Economy:

Let's recap, we came into 2020 with very strong economic indicators. 

  • 273,000 new jobs added in both January and February across all business sizes (large, medium & small).  It was broad based growth.
  • Housing Starts—the construction industry— in December, January and February had its highest 3-month total and its highest 3-month average which hasn't been seen since 2007.

The upswing in the economy changed quickly after the government—national and state level—began to place restrictions on businesses.  We are now seeing numbers that reflect that business production is off and unemployment numbers are rising.  As of March 26th, new unemployment claims were nearly 3.3 million individuals.  This number is both historic in its magnitude, while at the same time being completely expected. 

The Government:

The Senate passed a bill that would provide close to $2 trillion in stimulus benefits spread through individuals as well as the business sector of our economy.  As of this writing it is way too early to understand all the nuances of the bill that likely will be signed into law by the President, assuming the House approves it.  These actions being taken by the government are designed to keep people employed and receiving income as we continue to fight the virus.  Previously the Federal Reserve took multiple steps to help our economy by reducing interest rates and providing liquidity in the bond markets.

The Market:

Based on many experts' analysis, there likely was an over-reaction to the expected future reduction in corporate profits.  When we look back at the 2008 financial crisis, which lasted 18 months, corporate profits declined less than 50%.  If we were to use the corporate profit model to value the market, this week's stock market lows would equate to corporate profits for the full year being off as much as 60% - 80%.  If businesses are shut for 3 months (roughly Mid-March, April, May and into June), it would be expected that their earnings would be off by less than 60-80%.

Final Thoughts:

Previously I shared a quote from one of the world's most successful investors, Warren Buffett.  Today, I will share a quote from one of the most influential people in my life.  My grandmother would say “This too shall pass” anytime our family had to deal with difficult situations. 

Based on the steps the government has taken, it is reasonable to think that once restrictions on individuals and businesses are lifted our economy should be poised for a strong recovery.  The exact timing of that recovery can't be known for certain; the virus is a key to determining that, however, we believe the stock markets will reflect the recovery well before the economy's numbers will. 

Please take a moment to review the attached piece from American Funds titled “Keys to prevailing through stock market declines”. 

As always, if you have any questions or concerns please feel free to reach out to any of us here at the office.  The governor here in New Hampshire has just announced further restrictions on non-essential workers, however we can still be reached at our normal office number and emails.  Stay safe!



Time Since Social Distancing Began - April 3, 2020

This is the 4th time I am reaching out to you since the COVID -19 crisis has started here in America.  I will continue to try to give you the most current and accurate information that I can based on what I know as of the time I am writing to you. 

This is a crisis that has two main fronts to it: the actual COVID-19 virus and then the effects on our economy and our investments.


As of this time we have over 245,000 cases confirmed in the US and 479 here in New Hampshire where our office is.  We have not reached the peak of the total number of new cases as there were 30,100 new cases across the country as of 4/1/2020, up about 5,000 from the day prior.  Many experts suggest that we won't hit the peak until at least mid-April.  It feels like new techniques to fight the spread are being implemented daily; closing of more businesses, foot prints or lines on the ground at essential stores to guide us in proper social distancing, and the newest one I heard this morning is that we all wear cloth masks if we are out.  

The Economy

We are just starting to put numbers to what is intuitively known by all of us, all the actions taken to try to slow the virus have decimated our economy.  What was, by most measures, a very strong economy as recently as late February has just fallen off a cliff.  The new unemployment claims numbers for the last two weeks were over 3.3 million as of the March 21st report and almost 6.65 million people as of March 28th.  To give a sense of perspective, at the peak of the last financial crisis unemployment claims were 665,000 as of March 28th of 2009.  Literally 10x worse; and most experts think the numbers have not hit their highs yet.  Clearly, if most businesses are closed and many people do not have a job it becomes nearly impossible to continue to participate in the economy.  We must hope that the checks many will receive from the current actions the government has taken will help reduce the damage to the economy and more importantly allow everyone to get the essential supplies needed to get through this.

The Markets

Markets will continue to be extremely volatile as daily headlines continue to inform us of how bad the disease is or the damage to different aspects of our economy.  Trying to “time the market” at most times is nearly impossible but making timing decisions now would be like playing roulette with 1,000 numbers on the wheel.  We are being told to “shelter in place” to reduce the spread of the virus.  I think this can be a similar thought with regards to your investment portfolios, “shelter in place”.  Making moves to your investments at a time like this based on a “timing belief” are not recommended.  If you have several years or more until you plan on using this money, you will have time for your investments to recover and more importantly if you are still purchasing new shares, the prices are very attractive relative to what they were just a couple of months ago.

Final Thoughts for Today

The headlines will get worse for both the virus and the economy and the markets.  Some of the numbers will be shocking.  The flood of information daily is overwhelming.  It is very easy to lose perspective.  On March 11th, my son and I went to watch the Concord High School hockey team play a playoff game at JFK rink in Manchester with nearly 1,000 other people.  That was less than 1 month ago but it certainly feels like it has been a lifetime since then.  We will get back to a time when sports are played again, restaurants are open (there likely will be a little more space between tables) and most people will have their jobs back.  We have much more to deal with between now and then but before you know it, we will start to find ways to get back to the “new normal”.

There may be more changes to the definition of “essential” employees but for now we are still here for you if you need anything.  If we are forced to stay in our homes and not come to the office (it is closed to clients and visitors at this time), we will be able to be reached by email and by phone to handle any needs you may have.

Stay safe and healthy!



Reopening our economy; When, how and what conditions need to be met - April 15, 2020


Reopening our economy; When, how and what conditions need to be met

This has always been a Virus driven event.  COVID-19 is the reason our lives have been altered so dramatically.  So, it is there that we start this update.  The US is approaching 600,000 confirmed cases but the rate of increase of new cases has slowed.  On April 10th we had over 35,000 new cases while yesterday's new cases confirmed were just shy of 25,000.  23,649 people have died in America as of April 13th.  Johns Hopkins University will continue to compile the numbers, but clearly, we are near the peak of the virus's effect on us physically.  We may have reached a peak, but others will continue to be confirmed with COVID-19 in the future and tragically some will succumb to the virus.

The Government

The actions taken by our government over the last several weeks, including passing the Paycheck Protection Program within the CARES Act, are all designed to help the economy and businesses during these forced shutdowns of economic activity.  Another, albeit less publicized, government action was taken by the Federal Reserve on Thursday of last week by releasing their plan to put $2.7 trillion to work across a variety of programs to sure up areas like “Junk Bonds”, consumer loans and Municipal Bonds.  “The Fed made it completely clear they are going to do everything possible to keep companies in business, employees in their jobs, and consumers in their homes, cars and credit cards”, wrote Blaine Rollins, CFA at 361Capital.  It is likely that one of the major reasons the market had its best week, last week, in over a decade was as a reaction to both nearing the peak of the virus and the actions of the government to “save” the economy.  

The Economy

The headlines over the last two days are starting to pivot to the “reopening” of our economy.  We ultimately need the economy to reopen for our businesses to be “saved” over the next several months.  As we get clarity on the details of how we start to come out from our shelter at home orders, we will start the process of returning to our routines.  We will need to see improvements in testing both to see who has the virus and more importantly is to be able to identify who HAD the virus.  If we know who has antibodies to the virus and presumably is then immune to getting it again, those individuals can go back to “normal”.  Long term we will need to have both a vaccine and treatment protocols to allow us to get back to large group gatherings, plane trips, cruises, concerts and sporting events.  Until then sports are likely to start up without spectators and restaurants will be reopened but have reduced capacity to allow for proper distancing.  Assuming these tests are not widely available soon, any recovery to our economy will likely not look like a “V” but rather will take much longer than initially hoped for.

The Markets

Bernie Sanders dropped out of the Presidential race last week and the perceived risk of a potential shift toward a more centralized economy went away. It is very ironic that the current government implemented almost $5 trillion in stimulus at the same time as Bernie Sanders dropped out and the markets thought that both of those events were positive.

This week is the start of earnings reports for the period that includes February and March and will start to give us actual hard data on the depth of the damage to large businesses.   These numbers are going to be very bad for most businesses.  These reports are generally looking backward into what has already happened, but they often give guidance as to what the business expects in the future for things like total sales, revenue, expenses and profit.  Stocks valuations likely will continue to be very volatile as these reports start to show mixed past results and mixed outlooks going forward.  This virus and its effects on the economy and therefore the markets will be felt well into 2021. 

It has been encouraging to see the reaction of many of our clients to stay the course while some (that are still receiving a paycheck) are increasing their contributions or making additional investments.  If you have any concerns about your situation, please feel free to reach out to us. 

Stay healthy and safe!



The Pros and Cons of Reopening - April 24, 2020

I am definitely suffering from “Cabin Fever”.  We are well over a month with extremely limited in person interactions and a drastically altered daily routine. As the weather turns warmer, and yes I realize we did have snow again this week here in New Hampshire, with the grass turning green and starting to grow, with leaves appearing on the early bloomers, it feels like time to get busy.  The state of our economy is making most people feel the same way, its time to get busy with our economy too. BUT we have that little thing called Covid-19 that does not want to go away. Let us address the virus first.


According to Reuters, the first confirmed case in the US was January 20th, 2020 in Washington state. As of April 23, there have been over 875,000 confirmed cases and 49,694 deaths in the United States. In New Hampshire there have been 1,670 positive tests and 51 people have died. 218 people have been sick enough to go to the hospital with this virus out of a population of over 1.37 million residents. Less than 2/100ths of 1% (.000159%) of folks living in NH have received treatment in hospitals. At first glance it does not appear to be a big deal but if you are elderly or have some conditions like diabetes, obesity, heart disease then it becomes much more dangerous. If you live in an assisted living facility or some other type of “senior living community”, enough precautions cannot be taken. This pandemic is not over, and even though NH had the highest number of new confirmed cases on April 22 at 99 for the day, it feels like the efforts to “flatten the curve” may have worked to some degree.

The Economy

These efforts, social distancing, closing of nonessential businesses, wearing of masks and isolating at home, may be finally having some effect on slowing the virus but there can be no doubt as to the effect they have had on the economy.  In my first writing on the virus from March 11th, I mentioned some industries “will take a hit and have a drop in business; airlines, cruises, convention businesses & theme parks.”  Airlines are down 95% in travelers, as of now there are zero cruise ships on the water with passengers on them,  most states have a “less than 10 people” rule for groups which has led to business gatherings and conventions to cease and we all know that taking a trip to a theme park is not possible as they are closed (unless you are going to Joe Exotics' old Zoo, The Greater Wynnewood Exotic Animal Park which is open from 9-6).  Darwin may have been on to something!

In that first communication I mentioned some “winners”. Zoom went from having maximum monthly users of 10 million to 200 million in March.  Netflix added 15.8 million new subscribers in the first quarter with many of those coming in mid-March. Target saw a 275% increase to its online sales in April so far. (Individual companies mentioned does not constitute a recommendation to buy their stock but rather to demonstrate trends that are happening due to the virus and our government actions.)  The number of new unemployment claims over the last 5 weeks is over 26 million people.

The Markets

Markets remain very volatile. In March we had multiple days that approached 10% swings up and down, but mostly down. In the last several weeks, we are seeing 500 point moves in the Dow rather than 2,000-point records. Suddenly, 2% daily changes in value feel relatively safe. The market will continue to be volatile. On February 19th, the S&P 500 stock index was at 3386 and on March 23 it closed at 2237.   That is a drop of nearly 34% but since then we have recovered some of those losses and are up about 25% off the low to a value of 2797. There are many experts that are suggesting that markets are over valued at this time and we will see more pressure on stocks pushing the prices down from here before a true recovery will happen. The last time the Government took such drastic fiscal and monetary measures was in 2008 and 2009 to help stabilize our economy from the real estate and financial crisis and the market followed that up with the longest bull run in measured history.

Final Thoughts

We need our economy to reopen. We need it emotionally. We need it for businesses, big and small. No one wants to become sick with the virus and when we reopen everything will be different. Handshakes likely will not happen. Handwashing and sanitizing will stick with us. I am sure we will stay a good distance from others when out and about.  It will not be like it was right away but with time we will find treatments that minimize the effects and a vaccine to protect us in the first place and then we will see stadiums full of fans watching the big game or favorite concert.  

I always joke that I'm invited to parties because I'm so much fun walking around with my “Debt Clock” app on my phone. This will likely be the one thing that has the largest impact on our society for years if not generations to come.  As our Government hands out trillions of dollars that we do not have, we are creating a larger and larger pile of “IOU's” that will need to be paid back. We will not have the money, so we will have to borrow more but now the interest rate will have to be higher to attract “investors”. Maybe we should elect a person like Dave Ramsey as President to help get us out of this long-term financial mess. 

Stay safe and healthy!