The Yin & The Yang

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Again, we are finding mortgage rates at unbelievable lows. The average rate in 2019 for a 30 year term was 4.25%; Bankrate currently shows mortgage rates in the 3.25% range.  For someone interested in buying a new home or refinancing; it could provide extra cash for other items. But if you are retired and wish for monthly income; those dividend yields and interest on bonds or CDs just doesn’t seem to cover it in today’s world. In 2011, the 30 year treasury rate was at 4.504%; our current rate shows it hovering at 1.25%. Other expenses have changed also: Just a few months ago, we were eating out at restaurants and enjoying meals made by others. Now, we find ourselves eating more at home. A side note here: In April, Google reported that the banana bread recipe was the most popular searched recipe. Hey, what else to do with those bananas that were bought and have turned brown? Our new normal has us teaching, adjusting to working at home, and learning how to socialize with distance.

Here, at White Raven Financial, the team continues to work in their own respective places. Each week we are striving to keep ourselves informed and motivated with regular video and audio interactions, staying up to date with the news, and honing our skills in investment analysis and financial planning. This past month, we developed a new financial position template that we hope our clients will find more informative and beneficial.

Not only have our everyday lives changed, but we are finding that the future of the economy is adapting within the new guidelines for keeping us healthy. Tony DeSpirito, Managing Director for BlackRock, wrote in his late April blog that they identified five areas of change that ‘could have’ implications in the future. In his article, it was not surprising that he identified technology, but he also highlighted the ESG sector (focus on environmental, social, and governance issues). Consumer confidence did drop in April – reflecting the COVID-19 crisis. Due to that and other indicators, we read about expecting more volatility until economic numbers start improving again. To help provide us with a view, in mid-April, FS Investments did a chart of three scenarios for restarting the economy. Meanwhile, we have the U.S. central bank continuing to demonstrate that it is committed to keeping the nation’s economy afloat. Liz Ann Sonders, of Charles Schwab, wrote about the relief packages from Congress and the Treasury Department in her High Speed: Bear and Bull Both Running at Full Speed blog. The thought, per the blog, is that the Fed’s actions may be sufficient to keep the economic crisis from becoming a financial crisis.

Traveling overseas, we find the rest of the world also battling COVID-19 on both the public health and economic fronts. Only time will tell what the lasting consequences on global policy, economies, and society will be. Alliance Bernstein (AB), in their Capital Markets Outlook: 2Q:2020, noted market returns improved for those countries that have seen a flattening of the curve of the virus. Due to the uncertain environment, their current expectation for global growth calls for a decline of 0.7 percent. The general theme – in almost all our reading – is it will be a drawn-out recovery.

Even though the damage to our economy and much of the worlds was significant, remember that from turmoil there is usually engines for new growth. As a society, we are resilient.

And we are now into Spring, where things blossom. We believe the major indices also blossomed. Breathing some fresh air, the blue-chip barometer (the Dow)* bounced forward 11.08% overcoming some of its March losses. The S&P 500 (SPY)* hopped a bit further bringing in a 12.68% gain for the month of April. The tech-rich Nasdaq Composite (COMPTR)* skipped through the flowers celebrating a gain of 15.45% for the month. (*After linking, click on Quarterly had & Monthly Total Returns, “Monthly” tab.) On Tuesday, April 28th, the Dow Jones Indices released the latest S&P CoreLogic Case-Shiller report. The report did a repeat from the prior month and again noted that home prices showed a modest increase (note – does not reflect the ‘shelter in place’ months yet). The 20-city composite Home Price Index in February reported a 4.2% annual gain; a 0.3% gain from the previous month year-over-year posting. Before seasonal adjustments, month-over-month data had the month of February showing a 0.5% increase over the prior month of January for the 20-city composite index.


Regards and thank you,

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 of April 30, 2020. 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.

Diane Jochimsen

Meet the Author:
Diane Jochimsen

Diane Jochimsen is the founder and lead financial advisor at White Raven Financial. Whether working on investment portfolios or with a financial plan, Diane always seeks to know more about clients’ values, aspirations, and end goals.