SVP Paul Nolte Interviewed on WGN Radio 8.19.21

Senior VP Paul Nolte talks about jobless claims coming down again, concerns about the Delta variant, and when we might see inflation finally come down.

Click here to listen to the interview

5:15

Portfolio Manager Insights | Weekly Investor Commentary – 8.18.21

Click here for the full commentary.

PORTFOLIO MANAGER INSIGHTS
WEEKLY INVESTOR COMMENTARY | 8.18.21
Investment Committee

One of the risks that all investors must manage is geopolitical uncertainty. Headlines on regional and global crises are not only alarming but can take investors by surprise since they are often beyond the typical business and market news flow. To make this even more challenging, managing these risks usually has less to do with adjusting one’s portfolio than about managing expectations and staying level-headed. How can long-term investors stay calm in the face of global events today?

There have been many geopolitical crises over the past two decades that have been intertwined with business cycles. These include: the attacks on September 11, the war in Iraq, Russia’s annexation of Crimea in 2014, on-going concerns over the nuclear capabilities of North Korea and Iran, the rising global influence of China, its crackdowns in Hong Kong, refugees in the Mediterranean, and many more. While each of these episodes is impactful in its own right – especially when there are humanitarian consequences – this does not mean there are always implications for long-term portfolios.


In the long run, markets have risen through periods of uncertainty

KEY TAKEAWAYS:

1. Despite recessions, political uncertainty and global wars, the stock market has generated strong returns over the past century.
2. Investors with long time horizons can benefit from a growing economy despite short-term crises..

This is because while markets may react to a variety of short-term news on a daily and weekly basis, what drives portfolios over years and decades is quite different. Over longer periods of time, slow and steady economic growth, corporate performance, and valuations matter much more. This was true during the conflicts in the decades following World War II and during the Cold War, when there were several long bull market expansions.

Of course, markets depend on global stability, the rule of law across regions, and business/consumer confidence. However, history shows that it’s a mistake to make dramatic shifts in portfolios in response to regional crises. Properly diversified portfolios, especially those built around long-term financial plans by a trusted advisor, are designed to handle these periods of uncertainty. After all, markets can fluctuate wildly at any moment, whether it’s due to geopolitics, economic shocks, or as we’ve learned the past 18 months, pandemics.


Global markets also perform well over time, despite ups and downs

KEY TAKEAWAY:

1. Although each region behaves differently, investors have done well across global stock markets over the past two decades.
2. Emerging markets in particular are especially volatile. Still, they have been an important component of diversified portfolios for years.

Recent events in Afghanistan, while troubling and still evolving, will most likely be no different. The Afghan government has been losing its tenuous hold on the hundreds of districts across the country over the past three months. U.S. and NATO troops have been scheduled to be withdrawn for some time now, especially after a so-called peace agreement between the U.S. and Taliban was signed last year. Clearly, mistakes and miscalculations have been made which are more frustrating given the U.S.’s involvement in the conflict for two decades. And while these issues will be debated by pundits for months to come, investors ought to avoid passing judgment with their portfolios.


There are many global opportunities today

KEY TAKEAWAY:

1. Many regions are still catching up to the strong U.S. recovery of the past year and a half.
2. Valuations are still attractive in emerging and developed markets, and uncertainty from geopolitical conflicts may create opportunities for long-term investors.

Ultimately, investors must consider these events in a broader economic and market context. Despite the strong bull market, there are still many investment opportunities across regions as valuations recover and earnings grow. A major challenge for long-term investors is to always keep a level head. History shows that doing so is often rewarded and improves the odds of achieving financial goals.

Historical references do not assume that any prior market behavior will be duplicated. Past performance does not indicate future results. This material has been prepared by Kingsview Wealth Management, LLC. It is not, and should not, be regarded as investment advice or as a recommendation regarding any particular security or course of action. Opinions expressed herein are current opinions as of the date appearing in this material only. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate their ability to invest for the long term. Investment advisory services offered through Kingsview Wealth Management, LLC (“KWM”), an SEC Registered Investment Adviser. (2021)

3:00

Kingsview Partners Appears on the Inc. 5000 for the Fourth Consecutive Year

Firm Ranks No. 1869, With A Three-Year Revenue Growth of 241%.

Inc. magazine today revealed that Kingsview Partners is number 1869 on its annual Inc. 5000 list, the most prestigious ranking of the nation’s fastest-growing private companies. This year marks the fourth consecutive year Kingsview Partners has ranked, having also garnered recognition in 2018, 2019, and 2020.

The Inc. 5000 list represents the most successful companies within the American economy’s most dynamic segment—its independent small businesses. Intuit, Zappos, Under Armour, Microsoft, and Patagonia all gained their first national exposure as honorees on the Inc. 5000.

“It is an honor to be ranked amongst such a prestigious group for the fourth time in so many years,” says Kingsview CEO Sean McGillivray. “The women and men of Kingsview work diligently to always put our clients first and consistently elevate the standard of care upon which our business is built. I look forward to doing my part to ensure Kingsview continues to be a force of change in the wealth management industry.”

Kingsview Partners’ ranking on the 2021 Inc 5000 is especially noteworthy given 2020’s unprecedented challenges. Their achievements during this period indicate a high degree of competitiveness within the financial industry, plus the flexibility and resilience necessary for long-term success.

“The 2021 Inc. 5000 list feels like one of the most important rosters of companies ever compiled,” says Scott Omelianuk, editor-in-chief of Inc. “Building one of the fastest-growing companies in America in any year is a remarkable achievement. Building one in the crisis we’ve lived through is just plain amazing. This kind of accomplishment comes with hard work, smart pivots, great leadership, and the help of a whole lot of people.”

Among the 5,000, the average median three-year growth rate soared to 543 percent, and median revenue reached $11.1 million. Together, the companies added more than 610,000 jobs over the past three years.

Complete results of the Inc. 5000, including company profiles and an interactive database that can be sorted by industry, region, and other criteria, can be found at www.inc.com/inc5000. The top 500 companies are featured in the September issue of Inc., which will be available on newsstands on August 20.

# # #

More about Inc. and the Inc. 5000

Methodology
Companies on the 2021 Inc. 5000 are ranked according to percentage revenue growth from 2017 to 2020. To qualify, companies must have been founded and generating revenue by March 31, 2017. They must be U.S.-based, privately held, for-profit, and independent—not subsidiaries or divisions of other companies—as of December 31, 2020. (Since then, some on the list may have gone public or been acquired.) The minimum revenue required for 2017 is $100,000; the minimum for 2020 is $2 million. As always, Inc. reserves the right to decline applicants for subjective reasons. Growth rates used to determine company rankings were calculated to three decimal places. There was one tie on this year’s Inc. 5000. Companies on the Inc. 500 are featured in Inc.’s September issue. They represent the top tier of the Inc. 5000, which can be found at http://www.inc.com/inc5000.

About Inc. Media
The world’s most trusted business-media brand, Inc. offers entrepreneurs the knowledge, tools, connections, and community to build great companies. Its award-winning multiplatform content reaches more than 50 million people each month across a variety of channels including web sites, newsletters, social media, podcasts, and print. Its prestigious Inc. 5000 list, produced every year since 1982, analyzes company data to recognize the fastest-growing privately held businesses in the United States. The global recognition that comes with inclusion in the 5000 gives the founders of the best businesses an opportunity to engage with an exclusive community of their peers, and the credibility that helps them drive sales and recruit talent. The associated Inc. 5000 Vision Conference is part of a highly acclaimed portfolio of bespoke events produced by Inc. For more information, visit www.inc.com.

For more information on the Inc. 5000 Vision Conference, visit http://conference.inc.com/.

1:00

CIO Scott Martin Interviewed on Fox Business News 8.13.21 – Your World With Neil Cavuto

Program: Your World with Cavuto
Date: 8/13/2021
Station: Fox News Channel
Time: 4:00PM

NEIL CAVUTO: You like telecommuting or just not being in the office? Well, apparently a lot of your bosses, a lot more companies are saying they’re fine with this continuing in some cases for another month or so past the September promised return to work to as well to twenty twenty two January, February, you name it. Welcome back, everybody. I’m Neil Cavuto and focusing on companies that are now allowing their workers to keep doing the virtual thing virtually, right? Well, for months, maybe quite a few months to come, the implications of this was Scott Martin, family expert, readers of the financial and other markets. Kimberly, the message from the companies is it seems to be working for us right now. We’d prefer in person, but now we’ve got these spikes in cases, the uncertainty about mass, what to do. So keep doing what you’re doing. What do you think?

KIMBERLY FOSS: Yeah, it’s just difficult, Neal, I understand that they want to be safe and they want to do the right thing, but at the same time, eventually we have to go back to work, because the bottom line is just the quality of work, the time it takes to get things down. I can tell you in my own practice, when we try to get software service, you’ve got the lady on the other end trying to help us. But she’s got the screaming Mimi in the background. And the bottom line is it takes us four phone calls for phone calls to get what I could have done with one person in the office focused on what our situation is, which then takes me more time, takes my employees more time, it takes more cost. I can’t be as profitable. That’s the end of the story. We need to make a profit.

CAVUTO: OK, you sound like a workaholic, and we’ve got to talk about that, because that’s a separate issue for you. But let me let me get to you, Scott. All kidding aside, these same companies are saying on the flip side of this that, yeah, we’ll let you continue working for them depending on where you work. We’re going to cut your pay. Google has already hinted that maybe pay cuts of up to 10 to 15 percent because you’re not commuting, you’re not as

expensive a local. And so why should they pay you that much? What do you think of that?

SCOTT MARTIN: It’s interesting because that’s kind of been the dark side of this option of how much we care about you as an employer. It’s like, yeah, you can do all this cool stuff, work from home, work by the pool, you know, take the dog out and do the conference calls, you know, on the street. But, oh, by the way, you’re going to get 30 percent less. I’m going to cut your other benefits, too. And that’s the goofy part of this whole thing. And Kim touched on it, getting back to the regular economy and the regular style of work. I mean, we’ve got an office here of about 15 people and we got about half of those folks back in. And it, myself included, think about when you’re going to work on a daily basis. You’re going to the bar, to the restaurant, to the dry cleaners. Yeah, because, like, this suit doesn’t clean itself, by the way. And that’s usually in that order of which I’m doing things. And you’re not going out spending money, you know what I mean? You’re not stopping at places along the way where you’re creating economic activity, you’re staying home, you’re staying inside, and you’re not going out. And you’re not generating kind of that economic growth, that economic activity that we’re so used to that the markets need, I believe, to stay at these levels.

CAVUTO: You know, I look at the markets, though, Kimberly, and, you know, the Dow and S&P were up again today. That makes, you know, four days in a row of records for them. So they’re panicking about it. They’re not showing it. And I’m just wondering whether it’s their belief we’ll get through this. Everything’s going to be fine. The earnings certainly have been fine through the pandemic. They’ll get even better the more even if it slowly pull out of the pandemic and they just see everything half glass full to you.

FOSS: Yeah, I think that they’re shrugging this Delta variant off and by the way, Neal, this is not the only variant that’s coming out, right. They’ve got variants out to two thousand twenty three. So interesting how they know that. But that’s another subject. But at the same time for. You just just a little area. You’ve got four point five truly trillion dollars on the sidelines to throw in money market and money goes towards best reward and is not getting rewarded in money market account. So you are going to see more money committed to the market. I think this is going to be a slight pullback. But what we pivot, that’s what America does so great and entrepreneurs do so great, they pivot,

they’ll figure out a way at the front door is locked. We’re going in the side door, the little door in the basement. We’re going to get in somehow some way. And that’s. What about capitalism and the investor?

CAVUTO: Well, I’m going through the refrigerator door myself, but I understand what you’re what you’re getting out there with this migration that’s going on. Guys, I want to thank you both very, very much.

4:49

CIO Scott Martin Interviewed on Fox Business News 8.13.21 – Making Money With Charles Payne

Program: Making Money with Charles Payne
Date: 8/13/2021
Station: Fox News Channel
Time: 2:00PM

CHARLES PAYNE: All right, so all week we’ve been talking about ways that you should own the future, part of the future, of course, includes how we’re lured off of our sofas and to certain industries where businesses are somewhat struggling. The answer, of course, is always going to be technology. I want you to check out, for instance, this Taco Bell define now they call it that because it defies the norms and it will define the future. It’s got a very small footprint, but technology actually allows it to serve more customers. It looks so cool. And imagine you go to a late Friday night after you had a few. Right. And then there’s this Nike store in Seoul, South Korea. This is amazing. They call it the Nike Ri’s. It’s designed to merge digital and physical for what they call a unique, immersive shopping experience. It’s all cool stuff. It also means really big money for investors if you know where to look. I want to bring, in King’s view, wealth management. Scott Martin has got a lot of this. Is that radio frequency ID stuff you see with those Amazon grocery stores and you go in, you put everything in a basket and you leave. Right. How can the audience get a piece of that action?

SCOTT MARTIN: Yeah, and it’s action that’s going to happen a lot going forward, Charles, just as kind of, I guess, the post pandemic retail environment emerges. And just as an aside, any any time you talk about Taco Bell or weave that into a stock story, you’ve got my attention. Love Taco Bell, hard core. That’s Yum Brands, by the way. Here’s RFID technology, though. RFID technology, though, that looks good to us. Charles is in Zebra Technology’s great, fundamentally strong company, has rallied a lot in the last several years, even pre pandemic, just because these guys are dominators in the space. So zbra is one that we actually like here to further take advantage of the trends going on.

PAYNE: I’m going to toot my own book for a moment, I have an entire chapter dedicated to Zebra in my book, Unstoppable Prosperity. Folks, you have to read how I discovered Zebra, how you can discover things every single day. Connect the dots and you can make a fortune. I digress. Let’s talk about these retailers and restaurants themselves, though, because I got to tell you, I think these retailers, a lot of them are going to survive. The stocks are already acting fantastic. A year ago, everyone hated Coles. I’ve seen upgrades on that. Everyone hated a lot of these other names. Or what are some of the names you like there, Scott?

MARTIN: Yeah, a lot of fun, a lot of ones that were it was like TJX, which is one that we own and we have owned that for a while. Charles, a couple other names, I guess I’m a little embarrassed to talk about because they’ve been awesome, but they were funny at the time. I mean, we could go back in the tapes, you know, when we were talking about this retail re-emergence. How about Darden Restaurants? How about Bloomin Onion? Yeah, Outback Steakhouse. And those guys like those are companies that have really done the following, Charles. They still have the room dining. They still have the traditional kind of dining experience, but they have totally shifted their business lines to the pickup in the carry out and so forth like that. They’ve got good food as well, like Taco Bell. I’m saying that kind of with a straight face here, but that’s food I like also, believe it or not. So those are areas, too, and restaurants that I still believe are set to emerge. And they’re ones, too, that you need to take advantage of when you see some pullbacks like we have in those stocks in the last couple of months.

PAYNE: All right, so we talked about the future, let’s talk about the past, this Sunday will be the golden anniversary of Nixon taking us off the gold standard. You’re a gold investor. You think it was a mistake? I mean I mean, obviously, I think it’s too late to ever go back. But if we could, would you.

MARTIN: No, I wouldn’t, and I think we’ve got to be grateful that we’re not. And yeah, you know, I’ve been called Goldmember on Twitter and on on Facebook and Instagram because we love gold, you know, like like Austin Powers used to say or the act used to say, Mike Myers would say, as he was gold member in the movie, because gold to us has value in the sense of Charles. When we invest our clients money, it’s not stock and it’s not fixed income. It has its own kind of correlation value amongst traditional asset classes that many investors hold. And therefore, that’s why I think gold going forward, it’s going to be a great addition to your portfolio.

PAYNE: I’m going to go back a little further and talk cool real quick. It’s up one hundred fourteen percent. I think it keeps going in part because of China. Is there a way for the audience to make money there?

MARTIN: Sort of you know, it’s funny with Coal, I don’t have the onions, let’s say, to jump into coal here, given the crazy move. I mean, you look at coal prices, like you mentioned the last few months, it’s wild. I actually believe kind of the forgotten peace to this whole energy scenario is a natural gas. Cheaper, easier to get. There’s more of it. So UNAGI is an ETF that tracks the futures price of natural gas. It’s trailed coal, its trail, this whole move. It’s the hated kind of partner, if you will, or the hated kind of alternative. And that’s when I look at as maybe playing catch up here.

PAYNE: Scott, you gave us a lot to chew on. Pun intended. Have a great weekend, my friend.

4:49

Portfolio Manager Insights | Weekly Investor Commentary – 8.11.21

Click here for the full commentary.

PORTFOLIO MANAGER INSIGHTS
WEEKLY INVESTOR COMMENTARY | 8.11.21
Investment Committee

Anyone with a driving commute knows to expect unforeseen events such as traffic, construction and detours. Even when the destination is certain and you arrive on-time, it’s never clear what may happen along the way. Similarly, most investors know that while markets and the economy tend to rise over long periods of time, they can fluctuate wildly over days, weeks and months. New data and events cause them to zig and zag as they adjust, usually without notice.

However, the sharp economic recovery has defied this rule with the S&P 500 gaining 18% year-to-date and the economy growing at the fastest pace in history. This sudden rebound may create unrealistic expectations as the business cycle reaches a steady expansion, even if markets rise for years to come. How can long-term investors maintain perspective over the coming years?


75% of the jobs lost during the pandemic have been regained

KEY TAKEAWAYS:

1. The July jobs report showed that 943,000 jobs were added during the month, pushing the number of jobs recovered to 16.7 million.
2. About 75% of the jobs lost last year have been recovered.

It’s important to acknowledge how robust the recovery continues to be despite a variety of concerns. Last week’s strong payrolls report showed that the economy added 943,000 jobs in July and the unemployment rate fell to 5.4%. This is a significant decline from last April when the jobless rate hit 14.8%. With these gains, which are consistent with those seen over the past year, nearly 75% of the jobs lost during the pandemic have been recovered.

The fine print is that these data are based on surveys taken before rising delta variant concern. However, it’s still the case that there were over 10 million job openings across the country, eclipsing the 8.7 million people counted as unemployed (not including those who have dropped out of the labor force). This may be due to worker skills, geography, and expanded unemployment benefits.


There are many more job openings than unemployed

KEY TAKEAWAY:

1. There are many more job openings today than unemployed individuals. Over time, this gap could shrink as companies find qualified workers, individuals move to new cities for opportunities, and those who had given up re-enter the workforce.
2. Expanded unemployment benefits may also be playing a role in keeping jobs vacant.

Despite the strong data, some investor expectations have already been called into question. Interest rates, for instance, spiked during the first quarter of the year as many expected interest rates to rise steadily until the 10-year Treasury yield reached 2%. As is usually the case, this straight-line increase failed to materialize and interest rates fell throughout the second quarter. Since then, many rates have stabilized and have resumed rising again following positive economic news.

There are other areas in which investors expect sharp increases month-after-month and quarter-after-quarter, across GDP, inflation, corporate earnings, and market returns. Investors should expect economic data, including monthly payroll numbers, to decelerate over time. Not only is this natural during this phase of the business cycle, but many investor and economist expectations may be too lofty after a string of historic numbers.


Interest rates have stabilized and have begun to rise again

KEY TAKEAWAY:

1. Interest rates, which declined throughout the second quarter, stabilized after last week’s jobs report.
2. It’s possible that rates continue to rise over the coming quarters as we enter the later stages of the recovery and the Fed discusses tighter monetary policy.

Similarly, it’s unrealistic to expect market prices to accelerate indefinitely. Markets have been exceptionally calm this year, despite a variety of concerns and the feeling of uncertainty. Investors should always be prepared for volatility, especially when few are anticipating it.

To be clear, this doesn’t mean that investors should be fearful of the market – far from it. Instead, they should continue to hold balanced portfolios that can help steer them through all phases of the cycle. In doing so, investors can increase the likelihood of reaching their destination without worrying about the bumps along the way. While investors should be grateful for the strong economic recovery, they should also maintain reasonable expectations while staying properly diversified.

Historical references do not assume that any prior market behavior will be duplicated. Past performance does not indicate future results. This material has been prepared by Kingsview Wealth Management, LLC. It is not, and should not, be regarded as investment advice or as a recommendation regarding any particular security or course of action. Opinions expressed herein are current opinions as of the date appearing in this material only. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate their ability to invest for the long term. Investment advisory services offered through Kingsview Wealth Management, LLC (“KWM”), an SEC Registered Investment Adviser. (2021)(2021)

3:00

SVP Paul Nolte Interviewed on WGN Radio 8.10.21

Kingsview SVP Paul Nolte discusses the lack of movement in the market this week, inflation, the low-interest rate environment, and the likely path of reducing the amount of treasury purchases. He also talks about the bull market for stocks, and whether a correction is coming.

Click here to listen to the interview

7:06

CIO Scott Martin Interviewed on Fox Business News 8.5.21

Program: Making Money with Charles Payne
Date: 8/5/2021
Station: Fox News Channel
Time: 2:00PM

CHARLES PAYNE: Now i’d like to bring up Fox Business contributor from Kingsview Wealth Management, Scott Martin. Scott, I want to pick up on that conversation with gold. You’ve been in gold here. You talked about being long. It it’s kind of stalled a little bit. Are you, though, convinced it still has the ability to be a hedge against inflation in a store of value?

SCOTT MARTIN: Yeah, and Charles, we also like it because it’s not a bond position and it’s not an equity position. So if you’re adding gold to your portfolio or looking to do so, I think you get a check out the correlation value that it presents to a portfolio. Because you’re right these days, with so much uncertainty ahead, both in the economy and what with D.C. and with the Fed is going to do going forward, as you were just discussing, gold can actually come in handy in either of those times when either we’re stimulating or pulling back stimulus because you’ll see people flee the volatility of the equity markets and go into gold as a solution.

PAYNE: You’ve expressed at least earlier this year, you expressed some concern about the junk bond yields, you were worried about how low they were, they’ve only got lower. What does this say? I mean, what’s the message here and what kind of adjustments, if any, have you made because of this in your portfolio?

MARTIN: Well, we still own junk bonds, but you’re right. I mean, the yield on junk bonds is meager at best. And so it’s just a liquidity rush, really, Charles. I mean, people investors are out there seeking any yield they can find anywhere in the bond market. So that to me is another kind of indicator of things, just getting a little bit overcooked here on the bond side. So when you’re looking at yields, seeing the 10 year Treasury, as you were just talking, I think we’ve probably seen the lows or come pretty close to him for the year and we expect yields to start rising here in the next few months.

PAYNE: Last time I saw you, you were getting a little bit more aggressive on the equity side were, you know, by the way, where where are you most concentrated, your biggest investments yet?

MARTIN: Consumer discretionary, mainly, Charles, as the reopening keeps happening, the consumers in the best shape they’ve been in many, many years. So we like the consumer discretionary names, the Amazons of the world. But so far, yes, we’ve been adding to things like I mentioned last week, that drop on, say, good news. We’ve had a slew of earnings reports come out that have been relatively good. Things like Apple and other technology companies have pulled back some. We’ve been adding on those dips because the long term story is still in place for a lot of these companies. And on short term weakness, that’s when you got to get in and add to those positions.

PAYNE: Hashtag buy the dip, I’m with you, my man, I think people are nuts. I don’t know who’s selling it. It’s just the computers, the algorithms. But if you are selling Apple and Amazon and those kind of earnings, you know you’ve lost it. Hey, Scott, thanks so much. Appreciate it.

2:24

Portfolio Manager Insights | Weekly Investor Commentary – 8.4.21

Click here for the full commentary.

PORTFOLIO MANAGER INSIGHTS
WEEKLY INVESTOR COMMENTARY | 8.4.21
Investment Committee

The economy has officially surpassed pre-pandemic levels after the sharpest recession and recovery in history. That this took place in less than a year and a half is not only remarkable but has also created opportunities for investors. Unfortunately, this same swiftness also left some investors unprepared as markets recovered last year and scratching their heads as markets reach new all-time highs this year. More than ever, it’s important that long-term investors focus on the entire business cycle as they manage their portfolios.

It is natural that, in normal times, investors tend to base their expectations on smooth patterns. This is especially important because forecasts often are projected from what has recently occurred or are based on historical examples. It’s in this way that the unprecedented nature of the pandemic and recovery have been challenging, such as when anticipating the direction of interest rates and inflation. This is especially true for those who based their expectations on the 2008 financial crisis which involved a long decline followed by a slow multi-year recovery.


The economy has exceeded pre-pandemic levels

KEY TAKEAWAYS:

1. The economy surpassed its early-2020 level after growing 6.5% in the second quarter.
2. It’s expected that growth rates will decelerate over the next several quarters and the initial economic reopening and government stimulus fade.

Instead, last week’s GDP report showed that the economy grew at an annualized pace of 6.5% in the second quarter, pushing the economy above its pre-2020 level. This is the fourth fastest quarterly growth rate since 2000 and is more than three times faster than the 2.1% average over the past two decades. This surge in growth should not be surprising as the economy reopens from the economic lockdown. This is because the recession was caused by a pause in economic output – not the destruction of productivity that would be expected during a financial crisis, an asset bubble, misallocation of resources, or even a geopolitical crisis. Factories and equipment were still in working order, employees maintained their training and skills, and those businesses with strong balance sheets were able to reopen quickly. Businesses in some industries even thrived during the pandemic.

Because of this, the National Bureau of Economic Research – the official arbiter of business cycle dates – has determined that the COVID-19 recession lasted only two months between February and April 2020, the shortest on record. This means that the current expansion is now nearly a year and a half old which, in hindsight, validates the market’s immediate recovery.


Growth has been robust since the recession

KEY TAKEAWAY:

1. The second quarter’s performance follows growth rates of 33.8%, 4.5% and 6.3% – all spectacular numbers as the economy has reopened. The NBER has determined that the recession only lasted two months which is officially the shortest on record.

The question facing investors today is what to expect as the economy transitions from initial recovery to sustained expansion. As this shift occurs and the cycle resembles a more traditional one, it’s possible that historical patterns may become more relevant. This would suggest that, while the business cycle is still young, the pace will certainly decelerate. After all, the economic reopening and COVID-19 stimulus are one-time events which should fade over the coming quarters and in 2022. However, this doesn’t mean that growth cannot remain strong, especially if business and consumer spending keep pace.

Of course, the economy and markets are not the same thing. Instead, they are related since robust economic growth, even if not at the pace of 6.5%, can drive corporate sales and profitability. Over longer timeframes, this can support market returns and bring valuations down to more reasonable levels. This can happen across sectors and asset classes which benefits diversified portfolios.


Slow and steady growth can support markets

KEY TAKEAWAY:

1. History shows that recessions and market crashes are short while economic and bull market expansions are long. While bear markets can be scary, focusing on the right timeframe is important.

Thus, investors ought to stay balanced as the economy enters a new phase and hold portfolios built around all phases of the business cycle. While the rapid pace of the past 18 months may decelerate, even slow and steady growth can be enough to support long-term financial goals. Investors ought to stay invested across the full business cycle despite slower growth.

Historical references do not assume that any prior market behavior will be duplicated. Past performance does not indicate future results. This material has been prepared by Kingsview Wealth Management, LLC. It is not, and should not, be regarded as investment advice or as a recommendation regarding any particular security or course of action. Opinions expressed herein are current opinions as of the date appearing in this material only. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate their ability to invest for the long term. Investment advisory services offered through Kingsview Wealth Management, LLC (“KWM”), an SEC Registered Investment Adviser. (2021)

3:00

SVP Paul Nolte Interviewed on WGN Radio 8.3.21

Kingsview SVP Paul Nolte discusses recent earnings numbers, travel planning, and what we might expect to see through the end of the year.  He also talks about what’s happening with job numbers, the Fed’s focus and why they’re keeping interest rates low.

Click here to listen to the interview

7:06