As kids prepare to go back to school and families make plans for that last long weekend of summer vacation, investors enjoyed new highs for blue-chip stocks this week. Despite the ongoing uncertainty of trade policy, stocks continue to ascend a wall of worry, having digested another quarter of robust earnings growth in part the result of faster U.S. economic growth.
Earlier this week, The Eagles’ Greatest Hits surpassed Michael Jackson’s Thriller as the best-selling album of all time. I would argue that “greatest hits” albums should be excluded, but that’s neither here nor there. Also, this month, the S&P 500 set the record for the longest streak without a 20 percent decline, or bull market. This trend started in March of 2009 and has lasted over 3500 days. The previous feat was the 1990s bull market which finally ended with the burst of the Internet Bubble in 2001.
A currency crisis in Turkey and continued trade uncertainty resulted in a volatile week for equities. International stocks, specifically emerging markets, started selling off. U.S. commodities were also weak. This was offset by positive news on the China trade front.
Matt Kish, banking and finance reporter for Portland Business Journal, spent some time with us in recent weeks to learn more about our fourth ownership transition process that began the end of 2017. We also had the opportunity to share with Matt that Ralph Cole, CFA, joined our board of directors this year. On June 30, Mark Kralj became director emeritus and we are delighted that he will continue to be involved with our firm for the next year until his retirement.
News broke this week that the Trump administration would consider bypassing congressional legislation to change the capital gains taxes rules to index for inflation. The current strategy that is being floated is to use the Treasury department and IRS rather than traditional legislation to redefine capital gains to include only returns in excess of inflation.