One of my favorite TV shows from years ago was a police drama, “Hill Street Blues.” Each show had scenes from morning roll call from the precinct. The sergeant running the meeting always ended with “Hey! Let’s be careful out there.” [https://www.youtube.com/watch?v=T2QApwtE8zQ]
Great advice for all of us over the last 6 weeks. Here are a few “let’s be careful” thoughts appropriate right now.
As you have undoubtedly heard, a significant piece of the stimulus package involves direct payments to individuals – here’s the first “be really careful” for the week. The details are still being worked out, but there are a few really important things to know, no matter what this looks like.
- The government will not ask you to pay anything up front to get this money. No fees. No charges. No nothing.
- The government will not call to ask for your Social Security number, bank account, or credit card number. Anyone who does is a scammer.
- These reports of checks aren’t yet a reality. Anyone who tells you they can get you the money now is a scammer.
And we predict that the scammers are gearing up to take advantage of this.
So, remember: no matter what this payment winds up being, only scammers will ask you to pay to get it. If you spot one of these scams, please tell the Federal Trade Commission: www.ftc.gov/complaint. You can keep up to date with the latest Coronavirus-related scams at www.ftc.gov/coronavirus.
If it feels like the market has been crazy for the last month, it has. How crazy was it? This picture shows just how volatile the market was in March. On the left, the chart shows the day by day percentage change of the Dow. On the same scale, the chart on the right shows last month’s daily change.
*The Dow Jones Industrial Average (DJIA) is an index that tracks 30 large, publicly-owned blue chip companies trading on the New York Stock Exchange (NYSE) and the NASDAQ.
Let me add some perspective to this:
If we take the percentage change each day of the month and sum them up, not netting the net change for month but the absolute value (think middle school math, not positive or negative, but just the sum of the numbers). We can make this comparison:
- Since 1915 the average percentage changes for an “average” month is 15.6%
- Prior to last month the three most volatile months were October 1929, October 1987, and October 2008. None of those months exceeded a total volatility score of 90%.
- The total absolute market swings in March of 2020 was 117%. That exceeds the previous high months by over 30%. There were 22 trading days in March. That means that the average day in March saw the Dow move, up or down, by 5.3%. No wonder March seemed to last forever.
The constant news flow and ever-changing response, worldwide, to the Corona virus created an onslaught of information, spin, fear and uncertainty. Add to that, the isolation of shelter in place and it has been a month that has been draining, to say the least.
Even with all the crazy events of the last month, we have survived! Here a few green shoots of positivity we have seen.
- Stimulus efforts are picking up and look like they will have a positive impact
- Social distancing and shelter in place appear to have slowed the growth of new cases in hotspots in California and Washington.
- State and local governments are stepping up with containment measures in many places
- The federal government has begun to mobilize efforts to provide aid
- Congress and the administration are signaling that additional financial aid will likely be necessary and have begun the process of defining a next package of stimulus and aid
Your team at Wilde Wealth is committed to taking care of you! We continue to proactively assess what is necessary to cope with the market’s insanity.
Please stay safe and healthy!