Client Letter

Quarterly Client Letter: Q3 2024

Today, the Federal Open Market Committee decided to reduce the degree of policy restraint by lowering our policy interest rate by ½ percentage point. This decision reflects our growing confidence that with an appropriate recalibration of our policy stance, strength in the labor market can be maintained in a context of moderate growth and inflation…

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Quarterly Client Letter: Q2 2024

Quarterly Client Letter: Q2 2024 When you find a truly wonderful business, stick with it. Patience pays, and one wonderful business can offset the many mediocre decisions that are inevitable. -Warren Buffett We were pleased to see that the five most profitable companies of the Fortune 500, based on profits generated in 2023, were, in…

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Quarterly Client Letter: Q1 2024

Therefore, we are prepared for a very broad range of interest rates, from 2% to 8% or even more, with equally wide-ranging economic outcomes — from strong economic growth with moderate inflation (in this case, higher interest rates would result from higher demand for capital) to a recession with inflation; i.e., stagflation. Jamie Dimon, Chairman…

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Quarterly Client Letter: Q4 2023

“I think that a life properly lived is just learn, learn, learn all the time.” Charlie Munger, 2017 Berkshire Hathaway Annual Meeting Investing in financial markets is a constant education. A year ago, a Bloomberg survey of economists forecasted a 65% probability of recession for 2023. As the year progressed, there were plenty of reasons…

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Quarterly Client Letter: Q3 2023

Quarterly Client Letter: Q3 2023 A soft landing is a primary objective, and I did not say otherwise.  I mean, that’s what we’ve been trying to achieve for all this time. The real point though, is the worst thing we can do is to fail to restore price stability… Federal Reserve Chair Jerome Powell, Responding…

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Quarterly Client Letter: Q2 2023

“Hindsight, the ability to explain the past, gives us the illusion that the world is understandable. It gives us the illusion that the world makes sense, even when it doesn’t make sense. That’s a big deal in producing mistakes in many fields.” -Daniel Kahneman Imagine you are the chief executive of the Finnish tire maker…

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Quarterly Client Letter: Q1 2023

“Recent indicators point to modest growth in spending and production. Job gains have picked up in recent months and are running at a robust pace; the unemployment rate has remained low. Inflation remains elevated. The U.S. banking system is sound and resilient. Recent developments are likely to result in tighter credit conditions for households and…

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Quarterly Client Letter: Q4 2022

“The margin of safety is always dependent on the price paid. It will be large at one price, small at some higher price, nonexistent at some still higher price.” It has been said countless times that, “History doesn’t repeat itself, but it often rhymes,” a quote attributed to Mark Twain. In reality, history occasionally does…

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Quarterly Client Letter: Q3 2022

We have to get supply and demand back into alignment and the way we do that is by slowing the economy. Federal Reserve Chair Jerome Powell 09/21/22 Press Conference The Stock Market and Speculation Deflation The stock market closed the 3rd quarter at the low for the year.  As measured by the S&P 500 (with…

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