2nd Quarter 2024 Burns Insights

218 Days: Wake Me Up When It’s Over

by Robert Burns

Can you guess what I am talking about?  Well, it sure isn’t Christmas! 

It’s everyone’s favorite quadrennial event, the Presidential Election.  Yeah!  What will this year’s election hold in store? The last one was so fun and uneventful (read sarcasm).  Yeesh! 

Now that we know who the two likely candidates will be, we have already been thrust in full campaign mode.  Like the last two, this next election could be even more divisive and positional than ever before.  It can’t help but garner your attention.

I try to keep up on current events, and as many of you know from our conversations, I have been known to have an opinion.  I’ll admit it; I can get passionate about my point of view.  Also,
I think I am right most of the time.  Luckily for me, I have my wife to let me know when I am not.

Noah and I get questions about how the election might impact the markets and portfolios.  Unfortunately, the answers are unpredictable because the markets are very complex and multi-faceted.  These are non-binary issues – it’s not just a question of Republican versus Democrat.  The election is just one factor out of thousands of factors that impact market and economic outcomes.  The markets are a discounting mechanism, whereby once the outcome is known, the markets will have moved in anticipation of the result.  As always, a new concern will soon follow and garner our attention.  With that being said, I would like to share with you a few tips on how to get through the next eight months.  At the very least, these are strategies that work for me.  Enjoy!

Election survival tip #1: Moderate your media intake.

It is important to be informed, but we recommend giving yourself a time limit on your exposure.  Whether you favor cable news or social media, spending too much time with it can be detrimental to your overall outlook – it tends to make us more negative and less hopeful.  For me, I will watch the speeches and debates directly without listening to the commenters so I can form my own opinion.  Bottom line, time is too precious of a commodity to spend getting worked up about things far out of our control.  At end of one’s life, no one will say, “Gee I wish I watched more CNN.”  (Fill in your favorite source.)

Election survival tip #2: Check off a “Bucket List.” 

I recently wrote that as we get older, time seems to speed up and get compressed.  None of us are getting younger.  Also, most of us have things that we would like to do during our lifetimes.  If you have the financial means, now would be a great time to consider doing it.  The political situation will be there waiting for you when you get back from whatever you choose to do:  a European river cruise; visiting the volcanoes of Iceland; or going with a couple of friends to Vietnam and the Rotary International Convention in Singapore.  (That’s where I will be from May 13 to June 1!) 

Election survival tip #3: Spend more time with loved ones. 

Our core tenet is “Life’s about relationships and experiences.”  You will never regret spending more time with the people who bring you joy.  Noah has a new hobby of pizza baking, and he invites his friends and parents for pizza nights.  For the past ten years, five couples have a “Gourmet Dinner Club” where we get together every other month and cook food based on a theme. My wife and I so look forward to these events.  It doesn’t have to be big.  Call an old friend; go watch your grandkids play soccer; go on a walk with a neighbor.

Election survival tip #4: Appreciate what your vote means. 

Voting is important – it is the quintessential manifestation of democracy.  In my opinion, if you don’t vote, you don’t have a right to complain (only half joking).  So few elections are decided by one vote, but I believe that each vote adds to the strength of our system of government.  And if you want to get involved more deeply, I think that’s great too. 

Election survival tip #5: Begin with a prayer.

I stole this concept from the world-renowned investor, John Templeton.  He had his “Rules for Successful Investing,” and one of my favorites was “Begin with a prayer.”  What he meant by this was that no matter how you feel or how much effort you have put into something, it never hurts to have a little divine assistance from the Big Guy upstairs (or whoever might be your source of spiritual peace).

I hope this helps you survive the coming months as we deal with the news and political ads.  Bottom line, we are all Americans, and I believe we all want the same thing:  a country that works for all of us – and that includes a prosperous economy for all of us.

Please know that we are there for you always.  All the resources of Stifel and our financial services professionals are there for you as well.  We are all working diligently to help you make the best possible decisions.  Don’t hesitate to call us should you have any questions or issues that need our attention.  We don’t take lightly the trust and faith you have placed in the Burns Investment Group.  We appreciate you deeply.

Noah's Corner

2024:  What We Are Really Worried About 

There is plenty on the mind of investors right now.  Did you hear that there’s an election this year?!  As Robert said, in election years we find that investors are paying particularly close attention to the news, which also means close attention to the markets.  Additionally, there are several global disputes going on or on the cusp of boiling over:  Russia’s invasion of Ukraine, conflict in the Middle East, tensions between China and Taiwan, etc.  Certainly, if there are volatile surprises in any of these cases (the election included), we believe the market would also respond with volatility.

However, there is something always lurking that we believe is more worrisome:  the unknown.  In late 2019, who predicted a global pandemic?  Not many, if anybody.  Who saw the full extent of the global financial crisis coming?  Very, very few.  Media immortalized them, but very few people actually saw this coming.  How about the terrorist attack on September 11?  Hussein’s invasion of Kuwait?  Black Monday in 1987?  The point is that perhaps most of the foreseeable developments like a difficult election cycle or escalation in the Middle East are already priced into the market.  What will really cause chaos from a market perspective are the things we cannot even fathom at
the moment. 

Donald Rumsfeld called this concept the “unknown unknowns.”  We believe there are plenty of foreseeable things to be worried about, and they can move the market.  Yet, if we can foresee them, so can the market.  What keeps me up at night is that something can come completely from left field to wreak havoc on our world, economies, and financial markets.

So what can an investor do?  The most effective strategies are remaining focused on the long term and keeping a cool head.  In the long run, the markets tend to overcome these types of events.  The U.S. markets are up massively in the last 25 years, 50 years, 75 years, etc. despite countless elections, recessions, wars, crashes, panics, and more.  In the short run, keeping a cool head allows you to remain invested while prices are at potential lows.  It’s so much easier said than done, but it is nonetheless true.

If you’d like to talk more about the risks in your current portfolio, please contact us via phone or e-mail to set up an appointment. 

Past performance is no guarantee of future results.