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April 1, 2021

by | Apr 1, 2021 | Quarterly Letters

Dear Client: Returns for the major stock indices for 2021 and the current bond and money market yields are as follows: Index        YTDDow Jones Industrial Average   7.76%S&P 500   5.77% Fixed Income Yields    1 year5 year10 year30 yearMunicipals  0.10%0.50%1.08%1.81%US Treasuries  0.06%0.93%1.73%2.40% Fidelity Government Cash Reserves Money Market Fund0.01% The first quarter of 2021 is off to a good start for the equity markets.  First and foremost, COVID cases are falling precipitously, and the vaccines are proving to be a huge success.  Though the numbers seem to vary, we believe that between the vaccines, the number of counted cases, and the CDC’s estimated unreported infections, nearly 70% of Americans have some form of antibodies.  And though we certainly do not know the final outcome of the new strains or whether the vaccines will permanently end all variations of the virus, we believe the worst is most likely behindus and that herd immunity will soon be here in 2021; and the great re-opening of America is underway!  While we remain optimistic for the year ahead, we believe as long-term investors, it is constructive to reflect on the last year.  We all remember too well how we felt one year ago, when the world nearly stopped in the uncertainty of the virus.  In the depths of the fear, no one knew how severe the virus would be and to what extent the economic engine would slow.  This fear caused panic and led to extreme behavior, leaving some companies booming while others ground to a halt.  The world was in disarray, and markets never stopped discounting and adjusting for every possibility.  Amid the uncertainty, we wrote:...