Morning Market Commentary:
- Governments and central banks everywhere have pledged to support the global economy.
- Countries in Europe and U.S. states are pushing to restart their economies.
- The sooner asset managers think the outbreak is under control, the sooner they can become more constructive on investing in the markets.
Central banks and governments everywhere have pledged to do whatever it takes to keep the global economy afloat.
Leaders of the Group of 20 – finance ministers and central bank governors from the world’s largest economies – have said they will introduce at least $5 trillion in economic stimulus. The U.S. Federal Reserve, the European Central Bank, and the Bank of Japan have each said they have a limitless capacity to buy more bonds, including corporate debt.
The Fed has cut interest rates to zero. Other global central banks made similar moves and they are all prepared to do more. They aren’t going to let the system crumble.
In addition, countries are increasingly discussing the reopening of their economies. Germany is allowing small businesses to open their doors again as of last week. Italy and Spain are also introducing plans as the number of new daily infections is stabilizing. In the U.S., we recently introduced guidelines for a state-by-state restart. We need to see those central banks and governments follow through on their commitments to ensure the global economies are healthy enough to rebound when the worst of the COVID-19 outbreak is past. Already, the Fed has committed to putting roughly $4 trillion to work to try and stem the tide in the U.S.
The G-20 nations are doing everything in their means to curtail the tide of this worldwide pandemic. At BWFA we are looking at how to position our clients portfolios so they take advantage of this rebound in the stock market but also prepare ourselves for the stops and starts of this rollercoaster ride of medical reports each day which has become common now over the past two months. We continue to meet and talk to as many clients as we can to review your individual investment portfolios, update financial plans, and reallocate funds to the most appropriate risk factors based on your individual goals.
Our team is here to help you and make sense out of this terrible situation. The feedback from our clients during this time has been truly amazing. The amount of support and encouragement has been astounding and gives us more energy to help you and our “BWFA Community” during this crisis. If we can do anything to help you or your family please don’t hesitate to reach out to us and we will set up a meeting to review your situation. Thanks for your support during this difficult time. We will reach our goal and this will get better but it is going to take more patience and more flexibility in our everyday life. We are in a new normal and that will forever change us. I hope and pray you all remain safe and healthy.
Robert G. Carpenter