Coronavirus (COVID-19) Update
As we shared with you earlier last week, Harbour Trust Company took significant steps to protect our clients and employees by instituting social distancing practices as part of our Pandemic Plan. More information relating to the transmission of COVID-19 from the Federal Government and its agencies, as well as State and local governments, rightfully dictates that our firm implement a more aggressive policy regarding our operations, public access to our building and face to face client meetings.
Operationally, Harbour continues to function as described below. All investment decision making, trading, and processing continue, and our key service providers and vendors continue to operate in a resilient fashion to support our needs.
Our building location is currently closed to the public; however, we established a safe and secure system to accept deliveries and exchange essential documents with our clients, who require these services. Please contact us to coordinate this service or if you have any other questions related to this service. In an effort to further protect our clients and employees, we will no longer participate in any face to face client meetings, in any location.
Harbour Trust Company has worked diligently to successfully transition many of our team members to remote access, and, as a result, we are fully able to address client service needs, just as we have in the past both electronically and over the phone. Our team fully embraces our mission to provide exceptional service to our clients, and as such you will not see an impact to the high level of client service you expect from Harbour Trust at this unprecedented time.
Global Market/Strategy Update
Federal Reserve Monetary Stimulus
The Federal Reserve has taken short term lending rates to essentially zero, in an effort to keep lending available where needed. They have also begun to buy Mortgage Backed Securities, which should drive mortgage rates lower, increasing home affordability and refinancing. Lastly, they are working with the US Treasury to purchase short term business loans, allowing businesses to maintain access to the credit used to fund their businesses.
Federal Government Fiscal Stimulus
The Federal Government announced plans being developed to directly pay US citizens affected by the business closures and slowdowns, tax payment deferment, industry lending packages, and other steps to help stem the slowdown in the economy and spikes in unemployment.
US markets have sold off to December 2018 levels in a matter of 16 days. The speed of this decline, based on limited economic data and earnings forecasts and estimated length of the economic disruption caused by global attempts to mitigate the spread of the virus, is adding to investor concern. The increased use of ETF’s, Robo Advisors, and computerized/algorithmic trading has been a big driver of the historically high market volatility, and intraday swings of 10% or more, negative-to-positive and vice versa. The long-term fundamentals of quality companies do not change this quickly, and we believe markets will correctly reprice stock prices higher as better information becomes available.
Sincerely,
The Harbour Trust Team
