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Observations & Insights (5/29/2020) Thumbnail

Observations & Insights (5/29/2020)

We hope you have had a wonderful week and we wish you a fun and safe weekend.

The stock market continued to post gains this week as only a few isolated areas in the US remain in lockdown, however there are several things we are keeping a close eye on...

  • Stimulus Package: There is much work to be done to get the next stimulus plan passed, but we anticipate it will be finalized next month and will be about $1Trillion. 
  • China: The geopolitical uncertainty surrounding China is on the rise. 
    • This week, China approved its national security law for Hong Kong. The US views this as the end of “one country, two systems,” which was supposed to be in place until 2047. It is very likely that the US will respond by removing special preference treatment for Hong Kong and imposing sanctions on individuals responsible for the change in policy. The US can also impose sanctions on banks that do business with sanctioned officials. Our sense is that if the US moves forward on sanctions, China will likely respond back and go after US companies operating in Hong Kong and US intelligence operations. 
    • Late last week, the US Senate unanimously approved legislation that could ultimately bar many Chinese companies from listing shares on U.S. stock exchanges, or otherwise raising money from American investors. The bill would require Chinese companies to establish they are not owned or controlled by a foreign government. Furthermore, they would be required to submit to an audit that can be reviewed by the Public Company Accounting Oversight Board, the nonprofit body that oversees audits of all U.S. companies that seek to raise money in public markets. The bill still has to pass the House before it becomes law. There are currently 156 Chinese companies listed on US Exchanges.
  •  Unemployment: The jobless claims that have occurred since the beginning of the pandemic are staggering. Although businesses are beginning to reopen, there is a growing worry about how many of the currently unemployed will be able to go back to work (data indicates that upwards of 42% of recent layoffs could result in permanent job loss). However, a BLS survey from Dec-April indicated that of the 17 million unemployed persons, nearly all of them believed that they were out of work only temporarily. We hope this is the case, but are watching closely to see what happens. 

Planning Idea for the Week

  • Reviewing Your Estate Plan: Although COVID-19 related restrictions are beginning to ease, many people continue to help slow the spread by staying home and self-isolating. There are still unknowns related to the pandemic and how it will play out, undoubtedly keeping us all on edge. Over the past few months, we’ve been forced to face fears of falling ill, losing a job, spending time alone, etc. With these anxieties weighing on your mind, it may feel as though there’s a sudden need to get your affairs in order, just in case.  

    It never hurts to be prepared in the event that, for instance, you may need to be hospitalized for coronavirus or any other sickness. Thinking about falling ill or not being able to make decisions for yourself can be frightening, but having an estate plan in place can help ease your concerns. 

    Many people are taking this time at home to update their estate plans, and if you don’t have one in place, there’s no better time to put it together. Visit our blog to learn more. 

With communities opening, we wanted to offer some options on how/where to get (non-medical grade) face masks...

Good News From Around the World

  • After growing up without a dad and raising two children of his own, Rob Kenney created a YouTube channel for people who don’t have the privilege of calling up their own dads or father figures to ask them simple questions. The channel, "Dad, How Do I?", was started April 1st and has become a quick hit with over 2MM subscribers and 6MM views.
  • This week, the world’s largest all-electric commercial aircraft successfully completed its first test flight—and it is being hailed as a significant milestone in disrupting the transportation industry and accelerating the electric aviation revolution.
  • An online pirate radio station, Radio Recliner, is helping make the isolation of COVID-19 more bearable for older Americans. Radio Recliner is run by a team of 18 senior DJs and listeners can submit song requests and ask the hosts to broadcast audio messages and shoutouts to friends and family members via their website. Originally only supposed to air for one month, it is so popular it is going to continue. 

We hope that you have a wonderful and safe weekend. Please do not hesitate to reach out with any questions at 907-677-8300. Please feel free to forward this article to family members or friends as you see fit.

From our families to yours, The Planning Group of the Northwest

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