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.
COVID-19
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!