Pinnacle Investment Management, Inc. is a comprehensive investment management and financial planning firm committed to the financial future of our clients.

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The Most Recent Market Update

 

  • Election Update

    Late Tuesday afternoon, most people, regardless of party affiliation, breathed a sigh of relief that the 2016 election was over and things would return to normal.  As we now know, that is not what occurred.  The polls proved wrong and Donald Trump won an historic victory and Republicans maintained control of both the House and Senate.

    As in the Brexit vote, the financial markets initially dropped dramatically.  However, at 2 AM President –elect Trump made a speech that was very conciliatory in both words and demeanor.  His speech provided some hope that his administration would work cooperatively with Democrats and Congress on items such as tax reform, and the markets began to recover.

    While the market rebound is encouraging, the election of Donald Trump raises more questions than answers such as:

     

    • What portions of the Trump platform will be pushed forward and which parts will be forgotten?

     

    • How likely it is that Paul Ryan and other Congressional leaders will support Trump initiatives?

     

    • Can corporate and personal tax reform be accomplished without adding to our already growing budget deficit?  If so, that could provide a tremendous boost to our financial markets.

     

    • Will he really try to dismantle existing trade agreements such as North Atlantic Free Trade Agreement (NAFTA) and scuttle proposed trade agreements like the Trans Pacific Partnership (TPP)?  While trade agreements can be disruptive, they are good economically because they increase exports and lower prices of imports. While everyone does not benefit equally the net impact is positive.  A reasonable compromise would be to find a way to expand our trade agreements while simultaneously and temporarily, lending a hand to those individuals and families who are disrupted by those agreements.  However we are not sure if Mr. Trump or anyone else in Washington understands the meaning of the “C” (compromise) word.

     

    • Can Mr. Trump reduce both government regulations and the size of our Federal bureaucracy?  If so, it would provide a significant economic boost.

     

    Our questions are unlimited and we will be watching both the President-elect’s words and actions closely for clues to the answers.

    Nothing has fundamentally changed our economic outlook.  The United States economy continues to grow albeit slowly, propelled forward by the ingenuity and the work ethic of the American people but constrained by a large government bureaucracy and increasing regulation.  Although (due to those constraints), our economic growth is weak by historic standards, it remains stronger than many other developed countries, and provides reason for optimism.

    As imperfect as our democracy is, it has survived many crisis and we view the current election of an untested Presidential candidate as just a bump in the road.

    We believe that our portfolios are well positioned for, although certainly not immune from, the current volatility.  We will be watching both words and deeds coming from Washington for clues to what lies ahead.  At the moment we do not have any portfolio changes planned.  However we will continue to monitor the markets and will make any adjustments we believe necessary.