The Markets are in a down draft again...

Dear Clients and Friends of ZWM,

As we write this, the markets are experiencing serious setbacks after the announcement of significant tariffs on our trading partners around the globe. While only time will tell the long-term impact of these policies, in the short term they are likely to be disruptive to global trade. Add to that the expectation of more inflation as tariffs cause consumer prices to increase around the world, and top it off with recession worries, and that equals the reeling equity markets we see now.

Of course, the short-term impact is frightening to witness. While history has shown that the markets recover over the long term, it is hard to hold onto that perspective in the moment. It can be especially difficult for those clients who need funds now to support themselves and who worry about where those funds will come from and how long they will last. I encourage you to review our note dated March 6th – if the markets go down, our portfolios will very likely fall as well. However, we have positioned our clients defensively in hopes of mitigating the downside. As part of that philosophy, we established strong bond positions for those who have near- and intermediate-term cash needs to ensure no disruption in your lives; this way, we can avoid selling your equities in down periods.

While it is challenging to look away from the short-term impact, our priority is to help every client reach their longer-term goals. That requires us to take emotion out of our strategies and focus on where you want to be decades from now. While no one likes being on a boat in a storm, a good captain must keep that boat on course, even while the ship is rocked by waves. Unfortunately, downside volatility is a normal part of the markets – often even in years that end positively. There will always be reasons to worry (and there always have been in the past - wars, stagflation, dot-com crashes, housing crisis, pandemics, etc.), and often these events do drive markets downward. However, despite the occasional setback, markets have always recovered on the back of a strong US economy.

We will continue to monitor the situation closely, act in your portfolio as appropriate; the key in these times is to keep calm (as best you can) and focus on the long term, no matter whether the eventual recovery is days, months, or years away.  

For those clients who are using their portfolio assets to support themselves – know that our number one goal is to ensure the security and protection of the money you need day-to-day. For clients still accumulating assets, we remain poised to put your cash to work strategically as the markets give us attractive buying opportunities. As always, we know that words on a page won’t be as helpful as talking with one of our human beings. Please feel free to reach out to any of us at any time to talk.

With our regards,

Tom Zimmerman, and our whole team at Zimmerman Wealth Management, LLC