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INVESTMENT UPDATE CALL:  Members of our Investment Committee held an investment update call on July 23, with a closer look at our latest thinking, outlook, and changes we’ve implemented. Click Here to Listen.


REVISITING RMD SUSPENSIONS WITHIN THE CARES ACT:  Due to this massive piece of legislation not being ratified until the end of March, many individuals already took what they thought were their 2020 required minimum distributions (RMDs). Many of those retirement account owners (perhaps this includes you) and beneficiaries wanted to “undo” those distributions that were no longer required and put them back into their retirement account.

Cue IRS Notice 2020-51, which was recently released. This ruling clarified that you may indeed choose to roll your RMD back into your IRA, which would lower your taxable income for 2020.

*If you took a distribution but would like to roll it back into your IRA, please let us know ahead of the August 31 deadline and we can make that as painless as possible.


RECOVERY TRACKER CHECK IN FROM OXFORD ECONOMICS: The foundations of this recovery are cracking under the weight of a mismanaged health crisis. Our Recovery Tracker fell for the third time in five weeks in the week ending July 10. The health index declined for the fourth consecutive week. Demand fell for the second consecutive week, its largest decline in four months, and employment was unchanged.

While the rebounds in retail sales, employment, and industrial production through June were alluring, policymakers should not fall under the spell of rear-view-mirror economics. As of mid-July, the economy is emerging quite frail from its first rehabilitation phase, and the risks of a renewed downfall are real. More fiscal aid and adequate health policy are necessary to ensure a sustainable recovery in H2 2020.

Figure 1: The Recovery Tracker fell for the third time in five weeks in the week ending July 10 – reaching its lowest level since mid-June. Half of the dimensions posted outright declines or a flat reading. The tracker has seen average weekly gains of only 0.4ppts in the past month.

CHINA ORDERS U.S. TO CLOSE CONSULATE IN CHENGDU:  China’s Foreign Ministry announced Friday it is revoking the license for the U.S. consulate general in the southwestern city of Chengdu. The ministry also ordered the consulate general to cease operations.

“The responsibility lies entirely with the U.S. side,” the statement added. “We again urge the U.S. side to immediately revoke its relevant wrong decisions, to create necessary conditions for the two countries’ relationship to return to normal.”

The announcement comes after the U.S. ordered China to close its consulate in Houston. State Department spokesperson Morgan Ortagus said the directive to close the consulate was made to protect American intellectual property and the private information of its citizens. Beijing had condemned the decision and warned of firm countermeasures.

HOW PRESIDENTIAL ELECTIONS AFFECT THE STOCK MARKET:  Every four years, the U.S. presidential election can have a major impact on policy, laws, and foreign relations. But how do presidential elections affect the market? And how does that affect you?

To better understand, U.S. Bank analysts studied market data from the past 90 years and identified patterns that repeated themselves during election cycles.

A review of market data for the S&P 500* going back to the 1930s revealed certain patterns emerging over those 90 years. The analysts saw that, on average, both stock (equity) and bond markets showed more muted performance in the year leading up to a presidential election than they did at other times. “When it’s a general election, the equity market underperforms slightly,” explains Tom Hainlin, national investment strategist at U.S. Bank. “Not to the point where we have concern for client portfolios, but that’s what we’ve seen from historical evidence.”


IRS RELEASES THIS YEAR’S DIRTY DOZEN TAX SCAMS – CORONAVIRUS EDITION:  The Internal Revenue Service today announced its annual “Dirty Dozen” list of tax scams with a special emphasis on aggressive and evolving schemes related to coronavirus tax relief, including Economic Impact Payments.

This year, the Dirty Dozen focuses on scams that target taxpayers. The criminals behind these bogus schemes view everyone as potentially easy prey. The IRS urges everyone to be on guard. “Tax scams tend to rise during tax season or during times of crisis, and scam artists are using pandemic to try stealing money and information from honest taxpayers,” said IRS Commissioner Chuck Rettig. “The IRS provides the Dirty Dozen list to help raise awareness about common scams that fraudsters use to target people… We will relentlessly pursue criminals trying to steal your money or sensitive personal financial information.”


TAKE ME OUT TO THE BALLGAME?  After four months of lock-down due to the pandemic, American professional sports leagues are returning to play even though the pandemic is not over.

NASCAR and UFC returned in May, while Top Rank boxing and PGA Tour golf returned in June—those are individual sports that were well-positioned to return with social distancing. Now the team sports are coming back—NWSL, MLS, WNBA, NBA.

If the biggest question around the return of sports is whether the leagues can keep their COVID-19 cases down, the second biggest question is when can they have fans in the stands.

Will fans be ready to attend a game in person later this summer or fall? The answer, based on a survey conducted by Yahoo Finance and Harris Poll, is no.