What Do We Do Now? - 2020 Mid Year Commentary

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As we continue past the halfway mark of the year 2020, we are looking forward to the second half and beyond in out goal based planning and investing.


Hi, this is Phil Calandra from Calandra Financial. The first six months of 2020 saw the advent of the worst global public health crisis in a century. In response the world locked down putting its economy into kind of a medically induced coma. In this country, the immediate effects were one a savage and nearly instantaneous economic recession accompanied by record unemployment. And two, the fastest deepest collapse in stock prices in living memory if not ever.

I believe that all lastingly successful investing is essentially goal focused and planning driven. All failed investing is market focused and event-driven, I have found that long-term investing success is only incidentally a function of the economy and the markets.

It is a direct function of how the investor reacts or more properly how he or she refuses to react. The smaller part of what I do for clients is the creation of financial plans.

The much larger part is helping you not to react in stressful times like this. I continue to believe that the equity market cannot be consistently forecast much less timed and that the only certain way of capturing equities superior long-term returns is to sit through there occasionally steep but historically temporary declines at mid-year the best.

That an be said is that the first great wave of the pandemic appears to be abating and the economy is slowly reopening. As it continues to reopen there will inevitably be some flare-up in new infections the interaction between the pandemic and the economy in the short to intermediate term is therefore perfectly impossible to forecast.

As is the timing of the development of a vaccine, the equity market crashed from a new all-time high on February 19th to a bear market low thus far on March 23rd down 34 in 33 days. 

There is no historical precedent for the steep decline we saw. Confounding it then posted its best 50 days in history the S&P 500 closed out the first half at 3100, 8.6 percent off its all-time high.

The economy is likely to falter back and forth from new highs to new lows it should also be noted that even if the pandemic continues to subside and the economy to recovery investors will still have to deal with what may be the most widespread civil unrest in our country in decades and what promises to be a bitterly partisan presidential election cycle.

Emotions seem likely to continue to run high with unpredictable short-term market consequences. I have very deliberately labored in this summary to convince you of the sheer unknowability of the short, say third quarter of this year to intermediate. Say through the first quarter of 2021 term economic and market outlook in the next breath.

remind you that not one of you is investing for the next one to four calendar quarters. You and I, our long-term goal focused planning drive. Patient, disciplined investors our focus is on history rather than headlines and our mantra is from Churchill the farther back you can look the farther forward you are likely to see.

Finally I would like to urge you to rethink back to January 1st of this year. Have your most cherished lifetime financial goals changed since then. If not I see no compelling reason to change your plan and no reason at all to change your portfolio.

Bbe of good cheer this too shall pass. Optimism remains to me the only long-term realism. By all means,  please be in touch with our office with me with any and all questions and concerns. In the meantime, thank you as always for being our client and I would encourage you to tune into our mid-year review coming up:

July 18th Saturday at 10:00 a.m. This will be a zoom webinar meeting. Keep your eye out for emails and more information on how to join me for the 20/20 mid-year review thank you for tuning in.

This is Phil Calandra and you’ve been on the retire road.

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As an independent wealth management firm, we represent only the interests of our clients — not those of a corporation or bank. We are committed to guiding those we serve towards and through their retirement years in the smoothest, most comfortable way possible. Investment Advisory Services offered through Calandra Wealth Management, LLC a Georgia Investment Advisor.

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