Fall 2015: Quarterly Update

Reginald A.T. Armstrong • The Armstrong Report


After a very quiet first half of the year, volatility came back with a vengeance in August and September.

The Economy

The economy continues to be a mixed bag. The second quarter GDP figures were strongly revised upwards, but the third quarter (as of 9/28/15) seems to be on pace for about 1.8%. Basically, more of what we have had the past number of years-tepid growth. More ominous for the economy is the flat-lining of the stock market recently. See my blog on our website entitled, "It's not dark yet... but it's getting there" for more on this.

The Markets

Between August 18th and 25th, the S&P 500 fell almost 11% (Source: WSJ.com); a wake-up call for investors who had become complacent. This volatility continued into September. This caused US equities to drop below their long term moving averages, indicating a potential change in investor sentiment. In fact, in the past year, all nine equity classes we track have dropped below their trend lines. This has resulted in many of our advisory accounts to shift to our most conservative stance in years. While we may not have a bear market here, we have to recognize that an expensive market combined with deteriorating market conditions is a potentially painful combination. If you have concerns over your stock allocation, please call your wealth manager.

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