In its 28th annual Retirement Confidence Survey, the Employee Benefit Research Institute (EBRI) discovered that 64% of today's workers feel very or somewhat confident in having enough money to retire comfortably, up from 60% in 2017. And although far more retirees are very confident in their retirement prospects than workers, retiree confidence in their ability to meet basic expenses and medical expenses dropped from the previous year. Moreover, both workers and retirees question the role Social Security will play in future retiree income.
SRI investors like electric cars for obvious environmental reasons. Many have flocked to Tesla*, for example, despite some of its current cash flow statistics that might frighten some more conservative non-SRI investors. These Tesla fans might well be motivated by the company’s electric car models, but their investments are also supporting another fast-developing, and proliferating, technology – namely cars that drive themselves.
During the week of April 30, a short documentary show about socially responsible impact investing, and featuring SRI Investing and me, will be distributed nationwide to over 200 PBS TV stations, to be aired periodically over the coming year.
When Mr. Trump was elected President, I cautioned against panic (although I was feeling some of it myself). I wrote the vibrancy of the global economy and the securities markets that reflect it transcend any U.S. administration and its policies. Privately, I remember thinking that even though that might be true, a Trump administration would almost assuredly create chaos and an increase in short term market volatility.
But that didn’t happen – at least not right away. Instead, the markets focused on an improving economy both in the U.S. and abroad and yielded a banner year in 2017. So far, the narrative for 2018 is different, and yes, Trump is finally causing the economic and market chaos I feared.
In light of continuing gun violence and mass shootings in the U.S. involving semi-automatic assault weapons, the undersigned investors representing US$634BN in assets are calling on gun manufacturers, retailers and distributors, as well as companies with financial ties to these industries, to review their operations, supply chains and policies and take meaningful action on this public safety concern.
The recent shooting incident at a high school in Florida, the latest in a rash of mass killings in the U.S. by a person with a readily available military assault rifle, reinforces my commitments as a financial advisor who specializes in SRI. One of the most important characteristics of socially responsible impact portfolios over the decades has been the avoidance of weapons, that is, of companies that manufacture and distribute weapons - this due in large part to SRI’s historical roots in the progressive religious community, particularly in the sensitivities and values expressed by the Quaker and Mennonite traditions (often referred to as the “peace” churches).
After reaching all-time highs on January 26, 2018, the Dow Jones Industrial Average and the S&P 500 went into a two-week slide that saw both stock indexes drop by more than 10%, a decline that is typically considered a market correction.1
Analysts have been saying for several years that the long, booming bull market was overvalued and due for a correction, so the drop was not a surprise in the big picture.2 And even after the 10% plunge, the Dow was up 19% over the previous 12 months, and the S&P 500 was up 12.5%.3
It's natural to be concerned about this kind of shift, but more important to maintain perspective and focus on your long-term goals. It may be helpful to consider some of the reasons behind the surge of market volatility.
OK, a couple of my clients have wondered why I haven’t bothered to comment on the recent gyrations in the market. I might well have commented around February 7 when it appeared the sky was falling, but as it happened I was on vacation in St. John, one of the Caribbean islands hit hardest by last fall’s hurricanes (and happy to be there spending money, thereby helping the recovery efforts). Internet service on the island is still very sporadic, and we didn’t have any service where we were staying that week. Standing outdoors in St. John, it was nice and warm, and the sky didn’t appear to be falling at all, just blue and beautiful.
Of course, by the time I returned home the market indexes had begun to recover, and the Dow Jones Industrials and the S&P 500 ended last week up 4.3% each, their biggest gains in five years. Stocks are still off their recent record highs, but certainly things appear to have stabilized.
I closed off 2017 with an SRI Investing tradition, making two donations to honor you, my clients, in appreciation of the trust and confidence you place in us. Even more importantly, you care enough to invest your assets to help create a better world. The first donation went to Heifer International (www.heifer.org), helping to create financial opportunities in underserved communities worldwide. The second donation is to purchase carbon offset credits from Native Energy in Vermont (www.nativeenergy.com), to make our professional practice carbon neutral. Native Energy was founded in 2000 (the same year I started my SRI practice) and is now a leading provider of carbon offsets, renewable energy credits, and greenhouse gas consulting.
The new tax law hasn’t been formally ratified by the U.S. House and Senate, but all indications are that the Tax Cuts and Jobs Act of 2017 will be sent to the President’s desk in the next few days. As you probably know, the House and Senate versions were somewhat different. What does the new bill look like?