09 Nov 2016

President Elect – Donald J. Trump

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Dear Clients & Friends,

Wow. The result that Donald Trump will be the next President of the United States has surprised the pundits, pollsters, experts, and financial markets. As we all watched the voting results coming in last night I am sure you all also noticed the immediate impact that the anticipation had on the futures markets and currency rates. This morning, we will likely see equities sell off and investors seek the safe havens of cash and other riskless assets. As your investment advisor, I ask for patience and calm. We will continue to find opportunity in these short term emotional market swings while keeping our primary focus on the long term objectives of our clients.

Our most recent emotional experience that sent markets reeling worldwide was the surprise BREXIT vote this summer when European markets declined 9% in one day. That vote was similar to last night. It is a reflection of the populist’s referendum on the political establishment.  Two months removed from BREXIT, the European markets have recovered back to pre-BREXIT levels as common sense and unemotional fundamentals found their way back into the equity markets.

Regardless of how you voted, we must all recognize that this is our new government. We desperately need to address the difficult challenges our country faces on a variety of issues. The strength of our Republic is based on the foundational concepts of our constitution. Checks and Balances. My hope will be that the President and Congress find ways to ensure the strength of our economy and move our country forward TOGETHER. Our electorate has voted for change and we will definitely be offered that in the next four years.

Our challenge, as a fiduciary to you, is to get to work to understand where we can take advantage. Our investment process of finding value never changes. We have prepared for this possibility with portfolios that are 5% to 15% more conservative than our Investment Policy Statements require. Over the past three years we have been focused on building portfolios to mitigate risk and protect against this continued uncertainty. In that context, we will continue to focus on long term performance that helps YOU and your family achieve the financial goals you have described to us.

Please reach out to us if you have immediate questions or concerns, but as we reflect on the results of this election, please know that the All Star team is working on your behalf to manage through the reaction in the financial markets.

Have a Great Day.

Bob Klefsaas and the All Star Financial Team

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