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2nd Quarter 2019 Newsletter Thumbnail

2nd Quarter 2019 Newsletter

Last month I was on a United Airlines flight travelling from San Diego to Chicago.  A colleague, Jim and I had spent the previous two days in beautiful Southern California meeting with common clients regarding their financial and tax affairs.  I have been working with Jim and his family’s CPA firm for 20 or so years having several clients in common.  Over the years, Jim and I have become personal friends as we are similar in age, married early (at least by today’s standards) and have kids around the same age. Looking back, many of my client relationships have developed through introductions from CPA’s.  I like to think that I connect well with client’s other advisors, especially accountants, given my first few years out of college I spent working in Public Accounting and understand the industry better than most.  


Southern California is always great to visit, most especially during this trip, due to the weather we have been experiencing in Chicago.  A cold, wet and cloudy spring and early summer.  In the Upper Midwest, we spend half the year yearning for summer and the years in which summer is delayed can be very difficult on our psyche.  But we always seem to muddle through and summer always arrives, eventually.


I find airline flights can be some of my most productive hours, usually catching up on technical reading.  This reading is generally hardest for me to a complete.  Although I enjoy reading, the topics tend to be dry, difficult and generally boring, but necessary, none the less.  I was reading a book on behavioral finance, a newer field with roots in economics and psychology that I find very helpful in understanding mankind’s complex relationship with wealth.  This field of research can explain a lot!  As I was ending one chapter and reviewing its application in my head, I could hear the reduced rumble of the jet turbines as the pilot was pulling power to slow our airspeed.  From experience, I knew we were near the Mississippi River and would shortly begin our descent into O’Hare International.   Soon the pilot would come on the intercom and inform the passengers of our arrival time, gate assignment, weather in Chicago, etc.  


Within minutes the Captain’s voice could be heard.  In addition to her other announcements, she made mention should you need to use the facilities, now was the time.  Flights home from San Diego average 4 and half hours and during most of that time, passengers can freely get up from their seats.  Of course, when prompted by the Captain, seemingly half of the plane was now crowding the aisle to take advantage of this last respite.  Interesting, I thought, how the mere mention of a full bladder would induce half the plane’s occupants to seek relief.  Maybe Pavlov was on to something and maybe I should have paid more attention in Freshmen Psychology.  


Markets move up and markets move down and lately the movements have been more pronounced.  At some point and possibly in the not too-distant future, the markets will move down and stay down for a longer period.  Those in the financial press and other market pundits will begin talking gloom and doom and just like the Captain’s announcement, many will be filled with an irresistible urge to exit the markets.   To find a safe place to wait out the storm and reinvest when the markets begin to recover.  Our advice is not to be led by these ramblings, but to stay the course and follow your plan.  We believe by following your plan, you have the best chance of accomplishing your objectives.


As always, we thank you for your business and for your continued trust.



Jack P. Cannata