Thomas D.D. Graff, CFA Fixed Income Portfolio Manager
The near-universal response from the Federal Open Market Committee’s (FOMC) release on April 25, which included the quarterly projections update, was that it was surprisingly hawkish and implied a Fed more optimistic on the economy. However, we are cautious about drawing too much of a conclusion on potential FOMC decisions two years from now. What the release did tell us is that the Fed remains focused on inflation as the key metric for determining when monetary policy will start to normalize.
William L. Paternotte, CFA Strategic Advisor
A few days of fishing on a remote river, far from cell phone coverage, Internet connections and TV can really change your perspective, at least for a while. Upon reentry to the connected world, you can’t help but be struck by the constant focus on what’s happening now—in the primaries, the European Union, etc.—that didn’t seem to matter quite so much when you were out of touch.
Paul Chew, CFA Head of Investments
Ethan Berkwits Market Analyst
The latest academic research suggests that there are certain common characteristics of active equity managers who deliver persistent outperformance.
Alice S. Paik, Strategic Advisor K. Brigid Peterson, Strategic Advisor
With favorable tax laws in place and talk of a possible higher tax regime ahead, many families are revisiting their plans for transferring to and protecting wealth for future generations. Although the future of tax law remains uncertain, current law and recent legislative proposals all suggest that transfer-tax exemptions could become more restrictive and tax rates could rise in the near term. Whether that happens in 2013 or sooner, no one knows for certain. These factors are further motivation for families to now craft and execute thoughtful plans for their long-term legacy if there is no compelling reason to wait until 2013. One key estate-planning tool is an irrevocable trust, in which a grantor cedes control over assets and gifts them to a beneficiary in a tax-efficient way. However, irrevocable trusts can be complex and the state laws that govern them limiting. Delaware trust law, on the other hand, provides several unique benefits to creators of trusts, trustees and beneficiaries that wealthy families should consider.
William L. Paternotte, CFA Strategic Advisor and Partner In the wake of recent gyrations in the capital markets, risk levels—or at least the perception thereof—are elevated. The combination of Europe’s financial crisis and attendant weakness in the euro, the United States’ struggle to resolve its own debt issues and keep its fragile expansion alive, and China’s efforts to suppress inflation while executing a “soft landing” has provided the markets with daily fuel for violent swings. It seems that no sooner does a ray of hope appear in one crisis than the market focuses on another one. Not only are the fundamentals shifting as events unfold, but the markets’ reaction to them seems to exaggerate the impact on portfolios.