Good afternoon to all. Brent Chavez with Aequitas Equitas Investment Group. I wanted to get this video out to all of you to follow up to an email that I had sent out yesterday. We’ve had some rough markets here over the last week or so and it has many people concerned about what’s going on.

As we look at the S&P 500, it’s been 18 months of highs and lows. This is back in January of 2018. And then again, we had a September and October, high rally that year. Then, we had an ugly pullback in December of last year. We found ourselves doing well in Spring. A pullback again towards the end of May. Then we had, as of July 26th, an all time high in the S&P 500. And then we see this pull back from that high in the markets, being a little bit unnerving when you have your money invested in them.

So we want to talk a little bit about what set off this pullback, this turbulence, this time. It started last week Federal Reserve Chairman Powell came out hawkish in his tone – what do we mean hawkish? Well, he was a little more aggressive in his stance on not lowering interest rates quite as fast as the market had wanted or had anticipated. So that kind of started a little bit of the grumbling within the market last week. Then Friday the US had announced an additional tariff on $300 billion of Chinese goods. And then the People’s Republic of China responded on Monday, by devaluing their currency, lowering the value of their dollar. Many people may think, why would a government want to do that? Well, it makes their products that they are trying to export out of the country cheaper and it makes goods that are coming into the country more expensive. And so they are trying to offset some of the tariff taxes against their goods coming into the US, but it really just set off a firestorm between the US and China on Monday. So, we saw that very ugly day down about 3%, which was the worst trading day in all of 2019. We know we’ve had some rough times here, but that actually was the worst trading day for the year.

So, what should we do from here. Making rash decisions is usually very expensive… panic, usually costs money. We don’t want to panic. All of you have had individual portfolios built to meet your risk number. If you have any questions or concerns or you’re overly concerned about what’s going on, give me a call so that we can meet and look at your portfolio, look at your risk tolerances and make sure you still feel comfortable with them.

But what’s the good news that most people are missing? Well, we want to remember we are at record low unemployment rates in the US. If you want a job, you can have a job. In fact, if you want two jobs, you can have two jobs right now. Probably could have three if you want to – there’s so much work out there. So, that’s always a positive.

Also something else was very interesting. So far this quarter, the S&P 500 earnings reports have come in – 76% of those companies in 388 companies of the 500 companies have reported so far for the second quarter – 76% of them have beat their earnings projections or their earnings guidance. In fact, some of the companies have beat it by thousands of percent. That 76% beat is actually above the five year average when it comes to the earnings reported by the companies in the S&P 500. So, again positive news.
Autos are another area we’re still seeing resiliency and strength in the economy. Year-to-date there’s been close to 5.5 million new car units moved in the United States. Again, that is just slightly less than last year at this same time – about 57,000 new autos less than what’s being sold here today.

So again, nothing’s falling off the edge of the cliff causing too much concern. Our job here at Aequitas Equitas Investment Group is to keep our eye on the data, keep an eye on your portfolios. We want to assure you, we’re working hard. If you have any questions or concerns, please give us a call. We look forward to speaking with all of you very soon. Take care.

brent@aeinvestmentsgroup.com
(215) 766-7002