Debates and other Things That [*Funk*] Me Up

SAS Financial Advisors, LLC |

With the nation still mourning Ruth Bader Ginsburg's passing last week, the SAS newsletter highlighted both Ginsberg's passing primarily as well as current market events secondarily. This week the SAS Newsletter highlights the Presidential debate brief recap, the stock market trends, Congress and the 2nd CARES Act status, the Congressional Budget Office, mortgages, more daily awareness, and the TD/Schwab merger update.


Wednesday night was the first so-called presidential debate. It was a combination of Donald Trump’s twitter feed meets WWE. Very upsetting on many levels and the betting odds on the Presidential race moved substantially towards Joe Biden. I follow the betting odds because I feel they are similar to the “efficient market theory.” The combination of the disastrous debate and the NY Times in depth analysis and revelation about Donald Trump's taxes for more than the last decade is painting a big challenge to the brand of Donald Trump. More surprises? I wouldn’t be surprised.



The stock market had its first month of declines this month. All averages have declined in the mid single digits for the month of September, traditionally a challenging month for the stock market. Of course we remember the various steep declines over the years in October but over the past 60 years October has been positive. Typically the last two years of a presidential election cycle the stock market under performs its first two years. This year, added uncertainty over election results is higher than usual.


Revived discussions over a 2nd CARES act has moved markets higher today. The House has lowered its dedicated dollar amount to $2.4 trillion including another round of $1,200 stimulus payments. The Treasury secretary said they are interested in talking. Again the Senate is sitting on the sidelines with its previous offer of several hundred billion dollars as a stop gap. The Fed continues its strategy of buying myriad securities, expanding its balance sheet and keeping interest rates low for the foreseeable future. Home prices and mortgages rates remain at historic lows.



The Congressional Budget Office offered its latest update on the economy predicting sluggish growth as far as the eye can see-30 years. Now long-term economic forecasts are remarkably unreliable however the CBO uses consistent inputs in its analysis. Expected growth emerging from the current recession should be very positive. It is the longer term that we will be confronting problems, the seeds of which are sown now.

Two major issues in the long term: 

  1. One is demographics and declining birth rates especially during and after recessions. This leads to a decline in the workforce and productivity. This can be made up with immigration as it has in the past, but current politics create uncertainty whether this will happen moving forward.
  2. Second element is our national debt. Low interest rates have been the saving grace for issuing debt and could rescue us, however interest rates can be unpredictable. 



For those of you with adjustable rate mortgages with the benchmark related to LIBOR rates, the plan by banks is to sunset LIBOR in December of 2021, because of its vulnerability to manipulation, and substitute a new benchmark rate. Keep an eye on that if it applies to you and check your mortgage note for what benchmark will take its place.



Home life marches on at a strange pace. New routines of farmers market trips, getting out for fresh air and cooking meals together persists. A client in a recent meeting shared some perspective with us on how she keeps her focus by splitting the day's tasks between a to-do list and a TTFMU list. “TTFMU” stands for “things that [*funk*] me up,” which our team collectively thought was brilliant. We’re all subject to the stress inducing factors of today. It’s a mnemonic that gives us permission to make space for our triggers and stressors as they regularly appear, let those emotions rise and pass, rather than resisting these regular occurring people, events, and feelings in our lives.

Stoics such as Marcus Aurelius of ancient Greece phrased his strategy to remind himself of each morning that he was probably going to encounter a lot of angry, stressed, impatient, ungrateful people during the coming day. By reflecting on this in advance, the hope was that he would be less likely to respond unkindly. According to his stoic philosophy, he further reflected that he believed that none of these people would be like this intentionally. They were the victims of their own mistaken judgments.

Another really great ritual our client shared with us is a decorative, memory box that she has kept for 20 years which holds tokens from all of her dreams and aspirations, some of which have been achieved, others which she grew out of wanting and continues to appreciate. What a great way to memorialize an intentional goal-setting process and see those goals come to pass in a tangible way over the course of a lifetime. Even in this crazy time, remember your goals and aspirations. Not every path towards them is linear and we’re here to help you get there.


TD Schwab Merger

The merger between Charles Schwab and TD Ameritrade will close on October 6th, 2020. The complete integration of the two firms, originally announced ten months ago, is estimated to take 18 - 36 months (April 2022 - October 2023) minimally.

What does that mean for existing SAS investment management clients with accounts held at TD Ameritrade Institutional? No changes and business as usual through April 2022 at the earliest.

Please have an increasingly contented week ahead. Your SAS Team.

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