October 2016 Update

I just wanted to drop a note as an update to my newsletter from Sept 26th….the springs continue to tighten.

As we approach the Nov 8th U.S. elections, there are several other important “weather systems” converging and which, taken collectively, we believe could trigger some short-term equity market volatility.

The three most significant systems are:

1) the sabre-rattling between the U.S. and Russia in Syria, with the potential of war contagion; both of these nuclear powers are benefitting from the promotion of an external enemy to distract from domestic challenges. Yesterday, Russia urgently recommended that Russian students abroad return home as soon as possible;

2) instability in the Eurozone banks orbiting around Deutsche Bank, stagnant GDP, an immigration crisis that is overwhelming their already stretched welfare systems, and the uncertainties created by a departing U.K and federal elections in France and Germany…and a potential Italian catalyst, and

3) desperation and frustration in Japan stemming from the futility of over 26 years of ineffective monetary and fiscal policy, choking Debt:GDP and an aging population.

We’re in ongoing contact with our Portfolio Managers as part of normal operations, and I’m happy to report that our managers already shared these concerns and had been taking defensive actions within client portfolios as a result of their own internal risk management processes. They have some dry powder after harvesting recent gains, and are patiently awaiting key support levels to get fully long again. If these support levels don’t hold, portfolios can be quickly de-risked even further.

Given how they handled the early 2016 market volatility and the post-Brexit “market zigzag” I am very comfortable with their positioning. With the added benefit of Martin Armstrong’s Socrates(TM) system to provide confirmation, I’m sleeping soundly knowing our Portfolio Managers are vigilant and pro-active, but there will be some short-term volatility that it would be wise to simply tolerate.

Over the summer, we worked on refreshing our website to coincide with beginning to provide editorial content to Michael Campbell’s Money Talks blog. I’ll be posting these articles on our new homepage, including an audio recording of my live radio interview with Mike on Saturday October 15th around 9:53 am Mountain time.

Over the last several years, both long-time and more recent clients have been discussing issues in a few key areas. Many people are starting to see global tensions rise and chatting within their social circles about the potential financial fall-out, and numerous clients started asking us how we’re prepared to deal with these rising risks. To that end, I created this special video to explain what we do and how we do it.

Patience, discipline and compassion are accretive to your wealth, health and happiness – so focus on these.

Cheers,
Andrew H. Ruhland, CFP, CIM
Founder, Integrated Wealth Management Inc.