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Vizionary Quarterly Update: 2021 Q3

2021's 3rd Quarter: A Tale of Two Economies

On the one hand, this summer was robust. Vibrant or even euphoric economically. Cooped up Americans travelled and spent their way out of the Covid funk of the last 15 months.  

Given ongoing constraints on global travel, much of this travel and entertainment remained in the lower 48 states, keeping all that economic activity at home. The result was a tight labor market and rising inflationary pressures as businesses had to raise wages to get workers.  

Supply of workers remained restrained as the Federal unemployment stimulus and the moratorium on foreclosures continued. The results raised markets and dispelled much of the emotional baggage many of us have felt since the Covid shutdowns started in early 2020.

The Other Shoes Drops: Labor Day Concerns

As Labor Day arrived and kids (with masks) went back to school, a series of things began to cascade leading to a substantial shift in the economic outlook for the near term.

  • The Federal moratorium on mortgage foreclosures expired, as did the Federal stimulus for unemployment payments
  • A fight over the Federal debt ceiling looms as does anticipated Federal Reserve tapering
  • Evergrande threatens to default on $300B in debt in China
  • Ship shortages and supply chain disruptions are stressing ports
  • Manufacturing inventory and additional systemic issues are creating additional supply line pressures.  

When Covid hit 18 months ago, container ships stopped picking up empty containers and shifting them back to export countries.  The result is hundreds of thousands of empty containers choking ports and exponential increases in the cost of moving filled containers.

For reference, estimates suggest that 2 years ago, a full container could be moved from Vietnam to the port of Los Angeles for $1,200. Today that cost is around $20,000. All of this in turn is threatening to further slow delivery of goods right ahead of the all-important holiday season.

Capitalism Is Finding Its Way

So, this is where we are today. We took some steps as the data emerged to move to a bit more conservative positioning with regard to the equity portion of portfolios.

Capitalism is still alive and well, and we are seeing the beginnings of new evolution to correct the systemic imbalances I outlined above. For instance, we are seeing individual companies charter their own boats to move their own boxes of freight from their manufacturers.  These smaller boats with lighter payloads can circumvent the blockages associated with the major ports and offload at secondary ports more quickly and at less cost.  

In the end – this is what capitalism does: it innovates, evolves, identifies inefficiencies, and overcomes to build better models that ultimately benefit consumers and the businesses and investors that innovate.

Our Path Forward at Vizionary

Here at Vizionary, we are continuing to evolve, innovate, and improve as well.

Our Newest Team Member: Katelynn Cosaboom

After adding Rebekah Wagner in April to help support your plans, I am pleased to introduce Katelynn Cosaboom in the role of Administrative Assistant. Katelynn will be supporting Wendy Burgess and Mark Powers in the area of client paperwork and support and she will be assisting with some charitable and client events we are planning as we move into the fall and 2022.  

Katelynn is someone we have known for a few years and as typical, we hire for character and attitude. Katelynn brings both to her role here. We are excited to help her grow into this role and support you and the work we are doing here at Vizionary.

Expanding Our Charitable Endeavors

We are excited about the organic growth we are seeing with our existing clients and with new profile clients who are joining what we are doing here at Vizionary.  

Our core philosophy is to help you "Do well so that we can do good." 

As we help our clients become more successful, we become more successful as an organization. As we become more successful, we get to do more good things both locally and globally.  I wanted to share two quick examples of this:

1. A New Vision of a Charitable Community

Mae and I were blessed to be invited to an event called “The Gathering” in September this year.  This is a group of faith-based philanthropists who are seeking to improve how we “do good” in the world.  

We listened and learned a lot about the current “Afghan refugee crisis”, national addiction facilities that are improving recovery outcomes, the global refugee crisis. We discussed phil-tech (philanthropic technology) companies seeking to democratize giving and bring the opportunity to help someone around the corner or around the world from an app on your phone. 

It was likely the most refreshing 4 days Mae and I have had in the last ten years. Fertile ground for dreaming about how we can “do good” as we continue to “do well”.

2. Investing in African Education through Neema

In early October, I was able to share at the annual fundraising event for Neema, which is an organization that operates a trades school for at-risk women in Kenya.

The example I used is that of the trees that grow on my property at home.  I enjoy the shade from trees I didn’t plant, and I am planting trees whose shade I will never stand in. Philanthropy is a way for us to pay forward the blessings we have been given from opportunities we did not create with the trimmings of our own financial trees  

As we grow our financial trees in the fertile soil of American Capitalism which itself was cultivated and watered by generations before us – it is incumbent upon us to look for ways to pay that forward. It is a personal matter of stewardship for each of us. 

Once Again, Thank You For Your Partnership

We look forward to sharing more with you about how we are seeking to “do good” here at Vizionary.  As you do well, we do well, and we get the opportunity to do good.  All of this starts with US helping YOU do well.  Thank you for the opportunity to be on your financial team, helping to cultivate, farm and groom your financial orchard. We look forward to continuing this journey together.

One last item: on October 24th, starting with drinks, appetizers and a silent auction at 5:30 pm – we are hosting rising country musician Sam Grow with a free concert at our home.  All proceeds for the night will benefit Foster the Family, an organization which advocates for foster children and foster parents across NJ.  We would love to have you join us.

All the best for a terrific 4Q21. Wayne Wagner Jr, ChFC