Well, Wasn’t That Special? [i]

by | Feb 4, 2019 | Investing

Happy New Year! If there is anyone left who thinks he can predict what the markets are going to do next, I assume he has not been paying attention lately. We had a difficult December, including such a bad Christmas Eve that I felt compelled to write a short note to you early Christmas morning (right after Santa left). It was simply unclear why there was suddenly so much negativity, and equity prices by virtually every measure looked low.

Well, our usual move was to wait and see, and rebalance and tax-loss harvest like mad – a very busy December for us. And suddenly January was a new dawn, a new day, and here we are up pretty significantly from year end. Even bonds did well. A few rumors of a China deal, some apparent softening by the Fed, and then even a record-long, if only partial, government shutdown could not restrain the rampant animal spirits.

The S&P 500 rose 8.0%–its biggest January gain in more than 30 years. Small cap stocks did even better, rising 11.2%. Foreign stocks followed suit in both developed (+6.6%) and emerging (+8.8%) markets. Bonds produced positive results, with the benchmark US Aggregate bond index rising 1.06%. High yield and emerging markets bonds turned in more equity-like returns in the 4-5% range. [ii] It was a good start to a new year.

Technology for life – what’s your plan?

In the last letter we talked about several interesting developments which may well expand our lifespans and healthspans. Both are important to consider in financial planning. Obviously, living longer means your assets have to last longer, and I find this coming up more often lately. Never mind assuming you need to support yourself to age 100, what if you are “unfortunate enough” to live beyond age 100?

The healthspan aspect may be even more interesting. We make assumptions about when we will stop working (e.g., age 65) that were used by FDR when he started social security! Time for an update? And instead of planning reduced activity in your 70’s followed by assisted living of some kind, what if you kept working and stayed active even after retirement into your 80’s and beyond? That plan would look a little different, wouldn’t it?

These years ahead may have some nice surprises in store for us; I suggest we plan to be around for them.


Another remarkable development: The Apple Watch for Seniors

Check out this interesting article from CNBC. The latest generation of these amazing little devices will continue doing what the iPhone has been doing for some time, replacing many other devices and adding new dimensions previously unavailable or even unimagined, and it is only the beginning. The watch will now measure and record a lot of your vital functions, serve as a computer and a phone, notice if you have fallen down (and can’t get up!), allow you to call 911 or another emergency number, or even call 911 for you if you can’t respond. It is directly targeting the market for people who need that kind of monitoring, as Apple and other technology companies move decisively into medical fields.

These are game-changing moves. Welcome to the future.


Roger Hewins


[i] Apologies to Dana Carvey, aka the Church Lady.

[ii] Market Data from Morningstar, Inc. February 4, 2019

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