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COVID-19 Office Updates

Gratitude Revisited

This morning I watched a video interview of Dr. Thomas Hoenig, Distinguished Senior Fellow at the Mercatus Center at George Mason University.  Dr. Hoenig was formerly Chief Executive of the Kansas City Federal Reserve Bank, and former Chairman of the Federal Deposit Insurance Corporation (FDIC).   He’s both smart and well-connected.  The interview was conducted on April 8, 2020 by Pedro da Costa, of Marketwatch and Forbes

Though Dr. Hoenig is no longer serving on the Federal Reserve Board, his experience is valuable, and his assessment of the current situation is credible.  To wit, and in effect, he says, “They will have meetings and video conferences, and a lot of back channel communications.  Then they’ll come together with one voice.  They will do whatever it takes.  There are no limits.”

I’m not claiming prescience in any degree, but I told you so. 

You, my clients, throughout this “this time is different” event, have exhibited a most remarkable stoicism.  I have been here in the office from 8 am to 5 pm every day, mostly alone, because our staff are working from home.  As you might imagine, telephone traffic has been brisk.  But, in a good way.  Many of you have called to express your belief that “this time is different” in the sense that it is always different; but more importantly, you see this event - crisis though it surely is - as an opportunity.  Some have said a bear market was overdue.  On net, allowing for the market decline, our business has continued to grow.   For all of that, I thank you.

I’ll have more to say about “this time is different” in the upcoming edition of Flourishing

Monday May 4, in compliance with the Governor’s Ad Astra reopening guidelines, we’ll be back in the office.  We’ll be masked.  I do not think the COVID-19 pandemic has run its course, and prudence dictates caution.  This is not the flu; it can be fatal (perhaps as much as six times more fatal than the flu); and it may possibly inflict permanent damage to lungs, heart, and other internal organs on those who survive infection.* People over sixty years old are particularly vulnerable, and that includes a majority of our clients.  I ask that you call for an appointment, rather than dropping in, to help us respect the Governor’s social distancing guidelines.  More importantly, we love you too much to lose you.

Thank you again; you are the best clients an advisor could ever hope for.  mh  


  • “Armchair Epidemiologists vs Shoe Leather Epidemiologists”, Robert Tracinski, The Tracinski Letter, April 26, 2020.

Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss. Past performance is not a guarantee of future results. This material contains forward looking statements and projections. There are no guarantees that these results will be achieved.

Eyes Wide Open

"Little drops of water, little grains of sand, make a mighty ocean and a pleasant land."

As the battle against the coronavirus pandemic continues to take its toll on human life and health, how we respond to it will help determine our individual outcomes. It's clear by now that as a nation we weren't as prepared as we might have been with testing equipment and facilities, ventilators, masks and gloves, and many other things that would have made a difference, both in lives saved and economic trauma spared.

The medical community working on the front lines, truck drivers across the country keeping goods flowing, parents becoming homeschoolers, and nearly everyone missing family and social events, have contributed to slowing the spread of this deadly virus. Our citizens' response has shown the resolve and strength of the American spirit, which is why we will conquer this viral pandemic and its economic consequences.  I have no doubt about that.

Professionally, my concerns are with the effects of the economic slowdown on family incomes and corporate profits. Naturally, the two are closely related, and normalizing both is key to the pursuit of your financial goals. Tragically, 26 million people have filed for unemployment in the past four weeks, nearly wiping out all the jobs created during the record 10-year economic expansion that just ended. Historic drops in consumer confidence, retail sales, industrial production, oil prices, and housing starts have shown how quickly our economy has gone from solid growth to dead stop. Yet, the stock markets have been soaring the past few weeks, recovering about half of the steep February/March decline. What's up with that?

As I've said before, we are in uncharted, mine-laden waters. At least for the historical period that includes all of our lifetimes, this time is different. Perhaps the nearest comparisons would be the Japanese attack on Pearl Harbor or the terror attacks of 9/11. But, after the initial shock, both of those events stimulated economic activity; whereas this time, we've closed our doors and gone home. Virtually every industry, with the exception of healthcare, has hit the wall.

The Federal government can stimulate economic growth with new spending, and the Federal Reserve Banks (Fed) can flood the market with dollars. Both have responded heroically in a well-planned response to this crisis. (I'll have more about that in the next print edition of Flourishing.) This coordinated response, I think, explains the stock market recovery, so far.

But, there are things that the government and the Fed cannot do, or at least not do alone.  For example, many supply chains have been broken, some virtually forever, as with many Chinese imports.  New facilities and new contract arrangements are needed.  In the long run, that may be good for American business and American workers. But, the government can't simply flip a switch to make it all happen, though it can get out of the way; and it probably should.  That would speed things along.  Nor, can the government itself create ideal conditions for people to safely return to work.  Until, or unless, we have effective treatments and a vaccine, social distancing will still be an issue; especially for industries where people congregate.  Restaurants, airlines, sporting events, churches, and schools, will continue to bear an inordinate share of the burden. It will probably take some time for things to return to normal.  So, we aren't in open water just yet.  Economic data, news headlines, corporate earnings reports, and stock prices may get worse before they get better.  Keep your eyes wide open, and your mind at peace, with

Magnanimous Despair

Magnanimous Despair alone Could show me so divine a thing Where feeble Hope could ne’er have flown, But vainly flapp’d its tinsel wing. ~ Andrew Marvell (1621-1678), The Definition of Love

Will the coronavirus pandemic be the end of America as we’ve come to know it? I don’t mean to be flippant, because I know that millions of Americans are suffering severe hardships. None of us saw this pandemic coming, but some are paying a much higher price than others, and that seems very unfair. As of the present time (Tuesday morning, April 21, 2020), more than 42,000 Americans have died of the coronavirus, and another 679,000 are still sick. Healthcare providers in many areas of the country have been overexposed and overworked, and many have fallen victim to the very illness they seek to treat. More than 22,000,000 Americans have filed for unemployment benefits in the past month. Perhaps not worst of all, but still troubling, is that many people are succumbing to despair.

My family and I have thus far been spared most of this trauma, but I do have three children (in their forties and fifties) who are temporarily out of work; and all of them have children at home to care for. So again, not to be flippant, but the America we know after this is over will be a changed America for sure, but in time it will be a revitalized, more prosperous America.

It’s a small sign of the changes to come, but I just received an email message from the social media conglomerate, LinkedIn, offering a work-at-home job search service. My guess is that that will become an important source of revenue for many families, as well as for LinkedIn. That’s how American capitalism works.

A friend of mine just posted this bit of history on Facebook: In the midst of a polio epidemic in 1949, with stricken children being fitted with leg braces (think Forrest Gump) and/or confined to iron lungs, a young San Diego school teacher decided that she could make a difference. Despite being afflicted with the disease herself, Eleanor Abbott created the children’s board game, Candyland. Ultimately, the game was sold to the Milton Bradley Company; and now, sixty-five years after polio was conquered by quarantines and the Salk Vaccine, Candyland is still delighting children of all ages. That’s American capitalism, too.

I wish I could guarantee that out there somewhere today, there is another Eleanor Abbott, turning her opportunity for despair into joy for others. I can’t guarantee it, but I’m sure of it; and not just one such person, but millions will do so. This is and will always be America, always made better through trial and tribulation, always turning despair into opportunity.


Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss. Past
performance is not a guarantee of future results. This material contains forward looking statements and projections. There are no guarantees
that these results will be achieved.

Summary of the CARES Act Small Business Provisions – Part 2 

In my last email message, I wrote about the Paycheck Assistance Program for small business, under the CARES Act.  I’m given to understand that demand is expected to exceed supply, so if you need such assistance, don’t hesitate to apply.  Talk to your banker, or go to for more information.

Today, I want to make you aware of the Employee Retention Credit.  This credit provides a refundable payroll tax credit equal to 50% of up to $10,000 in wages per employee (including health benefits) paid by certain employers during the coronavirus crisis. The credit is available to employers:

Whose operations were fully or partially shut down by government order limiting commerce, travel, or group meetings due to the coronavirus, or whose quarterly receipts are less than 50% for the same quarter in the prior year.

Wages paid to employees during which they are furloughed or otherwise not working (due to reduced hours) as a result of their employers’ closure or economic hardship are eligible for the credit.  However, for employers with 100 or fewer employees, all employees’ wages qualify for the credit, regardless of whether they are furloughed or face reduced hours.

The credit is for wages paid by eligible employers from March 13, 2020 through December 31, 2020.

Secondly, there is a provision which allows employers and self-employed individuals to defer payment of the employer share of the Social Security tax they are otherwise responsible for paying to the federal government on behalf of their employees.  The provision requires that the deferred employment tax be paid over the following two years, with half the amount payable by December 31, 2021, and the other half due by December 31, 2022. Interestingly (because I don’t know what difference it makes), the Social Security Trust Funds are held harmless by this provision.



NOTE: Neither the Employee Retention Credit or the Social Security Tax deferral are available to employers receiving assistance under the Paycheck Protection Program mentioned in my last email.


Employers who sponsor 401(k) retirement plans should check with their providers regarding provisions of the Retirement Assistance aspects of the CARES Act. And, of course, I recommend that you work closely with your tax and/or legal counsel in action you plan to take under these provisions.  LPL Financial, LLC and Family Wealth Management, LLC do not offer legal or tax advice.

Summary of the CARES Act Small Business Provisions – Part 1

Today’s dispatch concerns some areas that are well out of my area of expertise, but I think most of you will want to be aware of these things for the benefit of your business and/or working family members.

Under the CARES Act (the Act), the Small Business Administration (SBA) is authorized to offer $349 billion in fully guaranteed loans for paycheck assistance.  The program could kick off as early as April 3, with funds for some loans available immediately upon signing of documents.  The program is currently scheduled to sunset on June 30, 2020.

Any business, non-profit, veterans group or tribal business with fewer than 500 employees is eligible.  The SBA may set other limits relative to, and appropriate for, a particular industry.  Sole proprietors, independent contractors, and some self-employed workers are eligible to apply.  The Act also applies to hotel and food service chains with fewer than 500 employees per location.

Lenders that are currently authorized to make SBA loans are automatically approved to make loans under this program, so you may want to visit with your local banker.  But, you can also go to the “Lender Match” tab on the SBA website to use their free referral tool.

Eligible borrowers could theoretically receive loans of up to $10,000,000 or 250% of their average monthly payroll costs.  Loan interest rates during the covered period are capped at 4%.

Borrowers can use loans to cover eligible payroll costs, including salaries, commissions regular paid leave, and health-care benefits.  They may also use borrowed funds for mortgage interest and utility payments.  Borrowers will need to make a “good faith certification” that they will use the funds to retain workers, maintain payroll, and pay rent and similar expenses. And, the last item for today is that this law will waive rules requiring borrowers to pay certain fees, provide collateral, or be unable to obtain credit elsewhere.

There is a good deal more to this part of the CARES Act, and I’ll share some of that in a follow-up later this week, or early next week.  But remember, if this looks like something that will help you and your employees, applications may be taken as early as April 3, and this program expires on June 30.  Most importantly, please stay healthy.


Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss. This material may contain forward looking statements and projections; there is no guarantee that any forecast made will come to pass. Past performance is not a guarantee of future results.

Wednesday Brief- 04/01/2020

Like everything that comes out of Washington D.C., I suppose that the $2 trillion Corona Virus Aid, Relief, and Economic Security (CARES) Act has a political component.  But, ignoring that and the cost of the benefits, CARES looks like it will provide welcome relief to almost everyone who needs it.  That’s unlike the bailouts of 2008-2010, which mostly benefited big institutions and state and local governments. (Shed no tears for the big boys, though; they were not forgotten.)  Here is how CARES breaks down:  

Category                                       Total Amount                     Share of the package

Individuals/Families                      $603.7 billion                     30%

Big Business                                 $500.0 billion                     25%

Small Business                             $377.0 billion                     19%

State and Local Government        $340.0 billion                     17%

Public Services                             $179.5 billion                     9%

Courtesy and

Summary of the CARES Act

(Individuals and Families, Today; Small Business Tomorrow)     

  1. All U.S. residents with adjusted gross income up to $75,000 ($150,000 if married), who are not a dependent of another taxpayer and have a work eligible Social Security number, are eligible for the full $1200 ($2400 married couple) rebate. In addition, they are also eligible for $500 per child.  This is true even for those who have no income, and for those who have non-means-tested benefit programs, such as SSI benefits.
  2. For most Americans, no action is required in order to receive a rebate check as the IRS will use a taxpayers 2019 return if filed, or in the alternative their 2018 return. There are phase out provisions for single filers with income exceeding $99,000, $146,500 for head of household filers with one child, and $198,000 for joint filers with no children.
  3. Required Minimum distributions are waived for 2020 for all types of defined contribution plans. This applies to RMDs required for 2020, but attributable to 2019.  And, this is a true waiver.  You DO NOT need to make up the distribution next year. (We cannot yet determine whether RMDs already taken in 2020 can be rolled back; this was allowed in 2009, so we think it may be again this time, and we hope to have a definitive answer for you very soon.)
  4. The Act also provides for some loan and withdrawal relief for 401(k) participants and IRA owners. Details are too complex to discuss in this brief missive, but I want you to be aware in case you do need to make IRA withdrawals or request a plan loan. *


*Neither LPL Financial, LLC nor Family Wealth Management, LLC offer tax advice.  Before taking any action, always consult your tax professional.

Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss. This
material may contain forward looking statements and projections; there is no guarantee that any forecast made will come to pass. Past
performance is not a guarantee of future results.

Winfield Lockdown Week One- 03/24/2020

We at Family Wealth Management understand that we are all going through a stressful period.  I want you to know that we remain strapped to the mast of duty and responsibility, so if you need us, don’t hesitate to call.

With all of us experiencing different levels of lockdown, I’m going to try to keep you up to date on my thoughts with periodic emails and Facebook posts.  You may also want to check our website for updates.

Today, I’m relieved to see markets around the world moving higher, almost in unison.  I do not know, nor does anyone else know, whether this means the worst is over.  Public health officials warn that the spread of the coronavirus hasn’t peaked, so my optimism for the short-term is guarded. Here is my context, and what I’m looking for:

The United States is not a command society, so it has taken a while for public health officials to respond most effectively, but I think they now have a good plan in place.  We are also blessed with an educated and well-informed public that understands the seriousness of the situation, and is willing to do their part.  We Americans are the best, strongest, and most resilient economic society ever to exist. With that as preamble here are my thoughts today:

I have been watching for an end to the deflationary spiral that ensued from both the coronavirus scare and the collapse in oil prices.  I’m confident that the Federal Reserve will supply the dollar liquidity needed to turn the tide, and in the past few days, compelling evidence of that has appeared.  The effects are evident in today’s market rise.

The next big thing, I think, is some assurance that credit, debt, and bond markets around the world have truly stabilized, and though things look better today, this is not a one day fix.  Closely related to those issues is the strength of the dollar versus other currencies; a too strong dollar makes debt repayment more difficult for businesses in emerging markets.  Today’s leap in gold prices is a positive signal in that regard, but again, one day isn’t proof of a trend.

Those are my main thoughts today.  Please take care of yourselves. All will be well soon, and I look forward to seeing you on the other side of this challenging period.  Mh



Investing involves risk, including the potential loss of principal.  This material may contain forward looking statements and projections. There are no guarantees that these results will be achieved.