In today’s Steady Investor, we look at key factors that we believe are currently impacting the market, such as:
Should You Be Worried About Economic Repercussions of a Third COVID Wave?
Covid-19 cases are rising across the country, with case counts approaching levels not seen since the peak of the outbreak. With winter coming and many activities moving indoors, many worry this outbreak wave could reach dire levels in Q4. Should investors be worried about the potential for economic fallout? Answering this question means venturing into the unknown, but there are a few factors to consider that may indicate if the economy can hold up. For one, the U.S. health system and the scientific understanding of the disease are reducing hospitalizations and deaths, which remain under control (relatively speaking). Second, there does not seem to be any remaining political will to lockdown the economy fully, on the state or national level. While a full reopening remains elusive with case counts rising, a full lockdown may be too unpopular to pursue.1 Finally, as we have written before, we do believe that Congress and the White House will eventually arrive at a deal for another round of stimulus, perhaps sooner than many expect.
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You can’t predict how COVID-19 will impact Q4 or the economy. But the right investment strategy can make a huge difference in preparing your long-term investments for success and helping you navigate these challenging and unprecedented times.
To help you learn more about strategies that cater to different investment objectives, we have created our Dean’s List of Investment Strategies. Our Dean’s List describes five of our investment strategies that are ranked in the top of their respective classes by Morningstar (as of 9/30/20).2
If you have $500,000 or more to invest and want to learn about five of our top strategies, click on the link below.
Learn More About Our Top-Ranked Strategies!3
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U.S. Justice Department Brings Antitrust Lawsuit Against Google – The Justice Department’s investigation into Google’s anticompetitive practices has long been known, though it’s been less clear when the government would actually file a lawsuit. The time has arrived. On Tuesday, the Justice Department filed a lawsuit accusing Google of monopolizing search and thwarting competition, while also engaging in lucrative contracts meant to secure their position as the dominant platform for search. The Justice Department alleges that Google’s practices leave no opening for competition, which therefore results in less choice and innovation that would otherwise benefit consumers. Advertisers also suffer, the Justice Department says, because they are forced to pay Google’s prices (nearly all of Google’s 2019 profits came from online advertising). Interestingly, at the center of the Justice Department’s lawsuit is another behemoth in the Technology sector – Apple, Inc. Allegedly, Google pays Apple upwards of $10 billion a year in order for Google’s search feature to be the default option for search on iPhones, via the Safari browser. This payment is a major benefit to both companies: a 10% to 15% of revenues for Apple, and up to 50% of all search volume for Google. Google also has contracts with non-Apple smartphone makers that use Google’s Android operating system, requiring them to use Google as the default search engine. In all, Google owns or controls about 80% of search queries in the U.S., with the balance of market share spread across Yahoo, Bing, and others. If Google and the Justice Department do not come to a settlement in the coming months, and the case proceeds to the courts, expect it to drag on for years.4-
Still No Momentum on Digital Currency Moving into the Mainstream –The digital currency craze swept through the investment world rapidly in over the past couple of years, though it has largely been forgotten in 2020. Digital currency may not receive the global financial welcome it has been hoping for anytime soon. In comments this week by Federal Reserve Chairman Jerome Powell, he said the U.S. is in no hurry to issue a digital currency. The Fed has too many concerns currently about cyberattacks, counterfeiting, and fraud, as well as the impact on monetary policy. Because the U.S. dollar is the ‘world’s currency,’ it is imperative that any shift to digital currency be airtight. For its part, China is stepping up research on how digital currencies can better facilitate transactions, from a cost and speed standpoint. It plans to roll out a pilot program in April testing digital currency across four cities.5
There is no way to know exactly how this pandemic will continue to impact the market and economy, but finding the right investment strategy can make a huge difference when managing the highs and lows of the market. To help you learn more about strategies that cater to different investment objectives, we have created our Dean’s List of Investment Strategies.6
Our Dean’s List describes five of our investment strategies that are ranked in the top of their respective classes, according to Morningstar (as of 9/30/20).7 If you have $500,000 or more to invest and want to learn more about these strategies, click on the link below to see how they could potentially benefit you.
Disclosure