Dougherty Dispatch – Ukraine and Market Update

Putin and his army continue their relentless, if not efficient, attack on Ukraine.  In reaction, the western world has implemented more and more economic, business, and banking restraints on the Russians.  Oil and other commodity prices are at historic highs, and stock prices of many companies are quickly declining.

Some of our investors are nervous and wondering whether they should be doing something to defend against this, and perhaps even do something special to profit in the falling market.

As of the end of today, the S&P group of 500 stocks is down 12% year to date.  Tech stocks as a group are down almost 20%.  A few clients have extrapolated this to conclude that if things keep going like this, we will have no assets in 10 months— five more sets of 2 months multiplied by the 20% loss.

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Dougherty Dispatch – Ukraine

Hold on to your coffee cups!  As the Ukraine situation develops, the stock market has dipped 7% in the last five days.  For the year it is down almost 14%.

Despite Ukraine, half of this drop for the year can be attributed to the Federal Reserve’s threatening to increase interest rates to slow inflation—and the economy.  And, as I said in the newsletter, recessions usually come with a 20-30% dip in the stock market.

Unlike what happened in Kuwait when the allied countries came in with a military pushback, it appears that Russia will conquer Ukraine with little military resistance from Ukraine or the world.  It seems that the worst could happen is that Russia may face some guerrilla resistance for a time.  Sanctions between countries have become almost a yawn, and severe ones have been circumvented “under the table,” as they probably will be this time, too.   The result may be a bounce back in market confidence later this year—or sooner.

TD Ameritrade is required by law to report instant and constant valuations on all assets our clients own.  As we monitor our accounts, these ups and downs can be alarming.  What is our consolation during this period?  Knowing that what we own is of a quality substance:  Common stocks and funds of good companies that will continue to be successful.  And, diversification in our portfolios will also smooth out dips along the way.

Yes, we are on the hunt for investment bargains, too—there are more and more of them.

As one investor today said, “Don’t bet on the end of the world—it only happens once and the odds of it happening aren’t very good.”

John  and Seann and Nicholette

Winter 2022

Dear Valued Client,

Well, here we are in 2022, and so is Covid.  Ugh.   What a roller coaster!

This time last year, we came in to 2021 believing that the newly developed vaccines would put this thing behind us.  We gained hope when vaccines became available, then lost hope when a large portion of populations did not take the vaccine, then regained hope when hospital deaths declined, then lost hope again when the Delta variant emerged, then regained hope when warm months arrived, then lost hope again when Omicron emerged, then gained hope when death rates from Omicron were found to be lower, then lost hope when we discovered that prior therapies such as Regeneron, are not effective with Omicron, then regained hope when data shows that boosted virus victims are 90% less likely to end up in the hospital or emergency room if they get the Omicron variant!  

I’ll take a breath.

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What happened in November?!

As most of you follow the news and stock market, you may be wondering what is going on. There are basically three things happening: virus fears, inflation fears, and profit taking.

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Women are Better Investors. Say it Ain’t so!

It’s official. A recent study by Fidelity Investments has concluded that, on average, women do better than men at investments. This may be a surprise – especially to men – as we assume that men may have a keen business sense or because they spend inordinate amounts of time in front of their computer screens reviewing various security moves.

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