Referring back to my end-of-year letter, here are a few key points I went over.

  • Equity markets have historically reacted to a recession BEFORE it starts.
  • Back-to-back down years are rare.
  • This should be taken as an opportunity.

YTD Performance:

SP500:                                     +16.89%

Technology:                            +42.77

Industrials:                              +10.19

Consumer Discretionary:        +33.06%

The market has seen significant growth, much of which can be attributed to a couple of stocks including APPL, MSFT, AMZN, META, NVDA, and TSLA.

As mentioned before, 2022 was a year for the record books due to the massive rate increases bottoming out the fixed-income markets, being one of, if not the worst investing environment of all time. But then we get this first half and I’d be lying if I told you I wasn’t smiling. I am.

But not because I think I am so smart, or I told you so, but because of the simple premise that:

History doesn’t necessarily repeat itself, but it rhymes. The more we believe something completely changes the way we see the world, the more shocked we are when it reverts back to normal. As investments have appreciated this year, it makes my quarterly meetings with my clients that much more fun, but I cannot and do not take credit for this increase. This is the long-term effect of unemotional investment planning, layered with tax-efficient investments, a long-term time horizon, and strategic thinking in your advanced strategies. Just as I have been saying before here, I continue to say it.

Enjoy the ride, maintain long-term focus, and be smart about your moves. There are things coming up in the next couple of years that will absolutely change your plans. Whether it be tax legislation, sunsetting of estate planning exclusions, business changes, life changes, or career changes, just remember to breathe.

Here are a few things I am watching:

  1. Earnings season – So far, corporate earnings have really surprised me with how durable they seem. The U.S. consumer is stronger than expected at this point in the market cycle (contraction). I expect earnings to be weaker later in the year.
  2. Labor force participation – This is the number of people in the labor force as a percentage of the civilian population. While climbing at 62.6%, it is still the lowest since the ’70s. Ideally, I’d like to see that percentage go higher, possibly after a recession.
  3. Russell 2000 vs. SP500/DJIA – Traditionally, small and mid-cap stocks lead out of a recession, but so far, the R2000 index has significantly lagged. I expect to see outperformance the farther into contraction we get.
  4. Beginning of college football – Florida State is higher ranked for the first time in a while, so that’s exciting!
  5. Rowdy’s hockey lessons – He is learning to skate and is getting pretty good.


Enjoy the remainder of your summer!

As always, if I can help in any way, please feel free to call or email my office.

Philip Clark, CPWA®, CFP®, CLU®| Director/Portfolio Manager – Wealth Management
Direct: 626.788.3947 |

This information should not be construed as tax advice, nor should be taken as financial planning advice. Please consult your tax professional. These opinions are based on observations and research and are not intended to predict or depict performance of any investment. These views are as of the close of business on 07/28/2023 and are subject to change based on subsequent developments. Information is based on sources believed to be reliable; however, their accuracy or completeness cannot be guaranteed. These views should not be construed as a recommendation to buy or sell any securities. Past performance does not guarantee future results.