DEAR CLIENTS:

We hope this finds you well and enjoying the summer. We have been staggering our schedules to allow everyone here to take some time off. The fact that we have three qualified, full-time investment advisors and such an outstanding support staff has allowed us all to have some time away to decompress and come back to our work, renewed and refreshed.

MIDYEAR UPDATE

Economic changes have been coming at a fast pace this year. Interest rates were going up, changed to a hold, and then recently came signals of possible rate cuts that sent markets again to new heights. By historical standards, rates are low and could continue to stay low because of slow global growth. Lower rates are supportive of earnings growth, which increases the likelihood of the decade long U.S. expansion continuing, for the time being.

The U.S. Federal Reserve’s policy has been followed by other central banks around the world. The European Central Bank as well as China and Japan have all moved to increase economic stimulus. These efforts have helped drive strong stock market rallies year-to-date, around the globe. One area of uncertainty is continuing disputes between the U.S. and various trading partners. We expect to see occasional market swings related to these ongoing negotiations.

The U.S. economy is fundamentally healthy, with robust consumer spending and modest inflation. Unemployment is at its lowest level since 1969. Low unemployment eventually results in rising wages, as employers compete for talent. This is a central factor in growing inflation pressure in the U.S., however, inflation overall is remaining low at this time.

We are often asked about when we foresee the next recession and resulting market pullback. Since we cannot predict when those events will occur, we avoid market timing, choosing instead to construct client’s portfolios with the expectation that market pullbacks can occur at any time. We own solid companies, across many industries and countries. Declines are inevitable, but our diversified portfolios are built for the long term, to survive and keep moving ahead.

BF&A NEWS

Our new office is coming along nicely. Now that we have entered the phase of interior finish-out, things have slowed a bit, but we do see steady progress every time we visit the site. We have learned a lot about the frustrations of dealing with city agencies for various approvals, every step along the way. We do not have a move-in date yet, but we will notify you when we do.

We want to congratulate Brenda Segner on her retirement. After 7 years of driving to our office most weekdays from Fredericksburg, Brenda has decided that instead of dealing with IH10 traffic, she would prefer to spend more time with her beautiful grandchildren and in her garden. We wish her well and if you are wanting to spend some time in the Hill Country, check out her lovely Bed & Breakfast listing, Friendship Farms, in Fredericksburg, or you can call her direct at 830.998.7060, for reservations.

My family and I recently vacationed in the UK, spending time in London and various locations in Scotland and Ireland. While there we were treated to cooler temps, castles and lush scenery. I noticed while in Ireland, when it came time for goodbyes, the Irish would always send us away with the phrase, “All the best.” We wish you a lovely and relaxing summer with happy days and safe travels.

All the best-

— Priscilla "Cilla" McKinley