We’ve all been there: We are tired, it has been a long day, it is cold outside, and we don’t feel that well. There is this task that should be done outside due to the weather forecast. (We could have done the task at least a month earlier but it keeps getting put off for another day.) And due to the fact that we are tired, and it is cold outside – we do not do this task. Alas, we wake up the next morning and view disaster. Well, not exactly disaster but it feels like that. So here at White Raven Financial, our beautiful outside office1 now needs major repairs – all because we did not take the roof off last autumn. The snow that ended up falling, plus the gusting winds, and the later slush that formed had the morning dawn showing supports for the outdoor office broken due to the weight on the roof.
Here at White Raven Financial, Diane & Brett take pride in being financial planners. But as the preceding story shows, we do not do well on physical objects. Now our favorite on-site, all-time handyman at the Stump Farm2 has the extra work of repairing the main supports while he is in the midst of putting in the vegetable garden and continuing with spring duties of tackling weeds, mowing lawns, etc. to keep the grounds in tip-top shape for clientele. We thank him for the great job of keeping us humming along. And, if you wish to know why the pic of the auto; well, the answer is further down.
Our economy also continues to hum along; our President highlighted his agenda on April 28th3 by focusing on delivering benefits to ordinary Americans through dramatic expansion of government services. Then on May the 1st, Warren Buffett & Charlie Monger held their annual Berkshire Hathaway Annual meeting4. During the meeting Buffet mentioned that the U.S. economy is 85% of what it was prior to the pandemic, thanks to monetary stimulus and record-low rates set by the Federal Reserve. In case you missed it, real gross domestic product (GDP) 5 increased at an annual rate of 6.4 percent in the first quarter of 2021. Thomas Gryta and Theo Francis, in a Wall Street Journal’s artlice6, noted how the COVID-19 pandemic paralyzed supply and demand. They then tied that in with vaccinations and government stimulus creating imbalances in many sectors which in turn was leaving labor shortages. They summed their article up by noting that with the combination of demand and lack of supply, the usual next phase is a rise in the price of goods aka inflation.
Global supply chains have also come under pressure; Blackrock, in a May 12 commentary7 noted how companies are challenged with component shortages, rising raw material prices and longer delivery lines. Magnfi had a similar article but their highlighted country was China; their blog highlighted China’s8 search for gold and lack of supply.
Being a good networker should never be underestimated. Our handyman found out firsthand the logic of supply and demand when he tried to find someone to weld a few of the support pieces and learned that the wait time could go out several months. He then contacted the owner at UNRIVALED Innovations & Restoration9. In the summer of 2020, they had painted the ‘68 MGB for him. Similar but not exactly their type of work but they could fit that small task into their schedule: Success!
The major indices in April displayed a chorus of monthly gains with the Nasdaq carving out a new fresh record high. The blue-chip barometer (the Dow)* started the tune with a 2.71% gain. The S&P 500 (SPY)* following up with a brighter song and showed 5.24% for the month of April. The tech-rich Nasdaq Composite (COMPTR)* hit the high notes with a positive 5.4% for the month. (*After linking, click on Quarterly & Monthly Total Returns, “Monthly” tab.) On Tuesday, April 27th, the Dow Jones Indices released the latest S&P CoreLogic Case-Shiller10 report. The report showed that for the reporting month, home prices had again chosen to continue their increases with Seattle being one of the top 3 areas. The February 20-city composite Home Price Index11 reported a 11.9% annual gain; up 0.8% from the previous month year-over-year posting. Before seasonal adjustments, month-over-month data had the month of February showing a 1.2% increase over the prior month of January for the 20-city composite index.
Regards and thank you (as always) for reading,
The Team at White Raven Financial
Advisory services offered through White Raven Financial Services, Inc. a Registered Investment Advisor in the State of Washington.
*Indexes are unmanaged and do not reflect service fees, commissions, or taxes. You cannot invest directly in an index. Past performance is not necessarily indicative of future results. Returns for the DOW, S&P 500 and the NASDAQ are the total return (price only) provided by Morningstar as April 30, 2021. Diversification and asset allocation do not assure or guarantee better performance and cannot eliminate the risk of investment loss.
*The Standard and Poor’s 500 is an unmanaged, capitalization weighted benchmark that tracks broad-based changes in the U.S. stock market. This index of 500 common stocks is comprised of 400 industrial, 20 transportation, 40 utility, and 40 financial companies representing major U.S. industry sectors. The index is calculated on a total return basis with dividends reinvested and is not available for direct investment.
*The Dow Jones Industrial Average covers 30 blue chip U.S. companies selected by the editors of the Wall Street Journal. The Dow represents about 25% of the NYSE market capitalization and less than 2% of NYSE issues.
*The NASDAQ is a market-value weighted index that measures all NASDAQ domestic and foreign common stocks.