Between the recent market correction (since recovered) and a contentious Presidential primary season, many are expressing feelings ranging from cynicism to downright pessimism about the future. As investment managers, we balance that understandable view with the positive dynamics driving long-term opportunities in global markets. Whether considering U.S. technological innovation or evaluating economic trends that indicate increasing global prosperity—especially for consumers in emerging economies—we remain long-term investment optimists.
As Janet Yellen stops contemplating and goes about raising interest rates a tiny bit we are reminded of the “Last Shot” scene in the Broadway sensation “Hamilton.” With a careful hand on the rudder of global finance instead of a flintlock, Ms. Yellen has been calculating potential consequences of her actions (or inaction) and, hopefully unlike Alex, keeps some financial powder dry while hitting her target. Before discussing the predicament facing the Federal Reserve, let’s review some history of our nation’s first Treasury Secretary.
Our 2003 Newsletter “Hey Queen, This America Thing Could Be Huge” hazarded a guess at what Columbus may have blurted to Spain’s Queen Isabella upon returning from America. We drew an analogy that China’s growth would also change the world – and it has. In this Newsletter, we more broadly document the status of the acronymic BRIC emerging market countries of Brazil, Russia, India and China, and reflect on how recent market turmoil marks a critical inflection point in the ongoing emerging market story.
It’s annoying to learn that “in order to serve you better” an organization has installed a computerized phone answering system. Certainly some companies benefit from such systems, but we do look askance when a mechanized voice claims that the new scheme was introduced to benefit customers when, more than likely, any value accrues to the company. In this newsletter we expose one of Wall Street’s fairly recent innovations—the Exchange Traded Fund (ETF)—and question whether these were invented to serve investors better, as promoters claim, or for reasons that enrich Wall Street while exposing buyers to unnecessary risk.
The country swing band “Asleep at the Wheel” will soon visit NC and we will be there hoping to hear their classic, “Miles and Miles of Texas.” We encourage you to YouTube this catchy tune while reading this newsletter about our government’s desire to close an ongoing budget deficit, potentially by raising taxes. This thirst for new revenue reminds us of two things: 1) the importance of tax-aware investment strategies (such as Hamilton Point’s Global Core Equity Strategy) and 2) the need to anticipate how a changing tax code could affect even non-taxed investors like retirement accounts and non-profit endowments.