Market Update 3.30.2020

March 30, 2020

Is the Bull Market already back? Alexandra and Paul team up to explain why we don’t think so! In today’s video market message for the Willow community, Alexandra and Paul share insights, analysis and outlook on current market and economic conditions.

Video Highlights:

– After a big market drop, it’s typical to get a “bounce” that could be as much as 50% of the previous high. While it might look like the market is returning, we’ll show you why we don’t believe a “V” recovery is possible right now.

– With low consumer confidence (consumer makes up 70% of the market), high unemployment and still unknown toll of Coronavirus, we are not seeing any signals that the market is ready for a turnaround quite yet.

– We make moves based on data, not hope or hype. We continue to stay conservative and defensive.

– Right now we like sectors such as tangible assets (water infrastructure, farmland, etc), necessities (utilities, consumer staples) and technology (cloud computing, remote tech/remote health care).

– We continue to encourage leaders to see this as an opportunity to bring our existing structures into question and rebuild systems that are more equitable, sustainable and conscious.


As always, a deep bow of gratitude to you our clients. Please don’t hesitate to contact us with any questions or concerns.

Best regards,

The Willow Team
+1 413 236 2980

 

Market Update 3.25.2020

March 25, 2020

In light of this week’s federal relief effort and subsequent capital market improvement, Alexandra wanted to share her current thinking and analysis of what all of this means. The video also contains several charts and graphs to help explain things more clearly. Please click on the video below to watch her message.

Video Message Highlights:

1. Our risk indicators are still showing significant stresses in the structures that hold our capital system together. We see credit freezing up and banks are getting less trusting about lending to each other. Both of these are backbone mechanisms in our whole system. (Lots of fun charts and graphs in this section!)

2. The federal government passed a bailout package this week that promises “no ceiling” to the amount of help it will provide to support the economy.

3. While this eased tension in the capital markets and may help us find a temporary floor, we believe this strategy just continues to kick the can (or the barrel, at this point) down the road on a weakened and broken system.

4. When the Fed solves the problem by flooding the system with cash, we may have to pay the price later with an inflationary environment leading to recession. 

5. For these reasons, we are continuing to take a conservative approach in our investments.

6. We continue to have concerns about our current economic structures and we are optimistic about the chance to reset capitalism through Loving Change. Willow is intentionally positioned to help guide a new path forward and encourage companies and leaders into a better future.


As always, it is our great pleasure to serve you. We appreciate your trust and faith in us and we are committed to keeping you informed and empowered during this challenging time.

If you have any requests for topics or questions you’d like Alexandra to answer on video, we would love to hear them! 

Please don’t hesitate to contact us with any questions or concerns.

Best regards,

The Willow Team
+1 413 236 2980
 

Market Update 3.19.2020

March 19, 2020

Happy first day of spring! Alexandra has recorded another audio market message for today to continue to keep our clients informed as things unfold.

The financial situation continues to be challenging.  Here are key takeaway points:

  1. We continue to take a more conservative stance with our investments.
  2. We think Treasuries are becoming the safest place to be right now based on what we are seeing with REPO and money markets.
  3. Our indicators tell us a “bounce” is coming (market going back up temporarily), and when it does, we will move even more to treasuries to protect your assets in the near term.
  4. IMPORTANT: We are seeing high risk indicators in the banking sector and recommend that none of our clients keep more than $250k in cash savings at banks right now (this is the max protected by the FDIC).

Here are things we are currently watching:

  1. We are paying attention to the flattening of the virus spread in China and a returning to work. We are hoping that this continues and becomes global, which could signal a return in our economy (and global health recovery!)
  2. We are watching the government’s response in terms of bailouts, etc and monitoring that impact on the economy.
  3. We are closely watching REPOs and overnight cash markets, as well as bond spreads.

We hope you are staying safe and calm. In this time of social distancing, we also wish you comfort and authentic, loving connection.

We continue to watch the markets carefully and thoughtfully, taking action based on 33 years of riding economic waves. Thank you for your trust and the opportunity to love and guide you through uncertain times. 

Please feel welcome to contact us with any questions or concerns.

Best regards,

The Willow Team
+1 413 236 2980

Market Update 3.16.2020

March 16, 2020

As a first measure, we wanted to update our clients on what we are doing as a company to keep our employees healthy and safe during this time. We are taking all necessary and appropriate measures to ensure that we can keep ourselves strong and healthy to serve you.

We have implemented several protocols:

  1. The office remains open, but we have closed the door to outside visitors. All deliveries are being left outside and we are regularly sanitizing and cleaning the environment around us. 
  2. Employees who are feeling sick, vulnerable or showing signs of illness are working remotely and practicing self-quarantine.
  3. We are requesting that all client meetings move to phone and video conference for the time being.
  4. We have limited all corporate travel and events.

Health and safety of ourselves, our families, our clients and the world around us is #1. By doing this, we ensure that we are here to protect and manage your money.

There are 4 key market updates for today, March 16, 2020:

  1. Fed lowered rates to nearly 0% over the weekend. We see this decision (and the weekend movement) as an indicator of heightened stress in the financial system – more than the media is indicating.
  2. Charts and data are beginning to also show significant stress in the economy.
  3. Feds increased their REPO position (they upped their repurchasing volume) which did cause markets to respond favorably, although minimally.
  4. We took advantage of this bump to raise more cash in our portfolios. We are now operating at roughly 45% equities across our entire portfolio.
  5. If there is no continued relief and improvement tomorrow, we will continue to become more conservative in our investment strategy.

We continue to watch everything carefully and thoughtfully, with “ice in our veins,” so that we can take wise, calm and non-reactive action. Thank you for your trust and the opportunity to love and guide you through uncertain times. 

Please feel welcome to contact us with any questions or concerns.

Best regards,

The Willow Team
+1 413 236 2980

Market Update 3.12.2020

March 12, 2020

Indeed, we are seeing great reaction to the Coronavirus that is sending ripple effects into the economy.  It is our preference to see a response as opposed to reactions, since responses are thoughtful, less emotional and take a long-term view.

Key Takeaways:

There are 4 reasons we became a bit more conservative in our approach:

  1. The economy is slowing and many companies are reporting disruption to their work-flow. With many public venues and travel being shut down, this will affect consumer spending. The consumer is 70% of the GDP in the US, so a slowdown here will affect earnings.
  2. Spreads for corporate bonds have widened. This is an indicator of risk – the wider the greater the risk. There is more risk showing up in banks, which is not something we like to see since it is the fuel of our economic engine.
  3. Oil prices are hitting a new 52-week low – typical of a prelude to a recession.
  4. Fed response – they lowered rates by 0.50% and are injecting capital into the economy, but due to the consumer slowdown from COVID, we are not convinced that this stimulus will have its usual correcting effect.

There are 4 key things we will watch for going forward:

  1. Will credit spreads narrow?
  2. Will we see a global response (not reaction) to the virus?
  3. Will global central banks provide a coordinated response?
  4. Will the supply chain come back on quickly?

As always, please know that we are watching everything carefully and thoughtfully so that we can take wise action. Thank you for your trust and the opportunity to love and guide you through uncertain times. Please feel welcome to contact us with any questions or concerns.

Best regards,

The Willow Team
+1 413 236 2980

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