Cracking Down on Social Security

You have probably heard through the grapevine that a couple popular Social   Security "loopholes" are soon to be closed. The Bipartisan Budget Act of 2015 was passed by the House last October and among other things, it eliminated two popular Social Security strategies that we often have recommended to our clients: File and Suspend and Restricted Application for Spousal Benefits. While it's not really surprising that these changes are being made, it is shocking how quickly they will come into effect. When considering the new rules, it's important to keep these two strategies separate as the rules that govern them are different, particularly the age that you must be in order to be grandfathered in.

As you are probably aware, the government rewards retirees for delaying Social Security benefits. For each year past your full retirement age that you wait to collect, you get a delayed credit of 8% of your benefit up until age 70. File and Suspend is a strategy that would allow you to start receiving your spousal benefit before your spouse begins to take Social Security. The spousal benefit at full retirement age is ½ of your husband or wife's full retirement benefit. At full retirement age, your spouse can file for his or her benefit and immediately suspend it without actually taking any money. You can then file for a spousal benefit. Because your spouse's benefit was suspended, it continues to grow by 8% per year until age 70, but you are collecting ½ of the full retirement age amount in the meantime. While you collect half of their Social Security benefit, your own benefit also grows at 8% until age 70. This strategy was especially beneficial for dual high-earner couples.

To give a little history, the rule that authorized File and Suspend is the Senior Citizens' Freedom to Work Act of 2000. This act was designed to encourage retirees to keep working. It eliminated the earnings test in and after the month a person reaches full retirement age and permitted workers over full retirement age to suspend their benefit in order to build delayed credits. Fortunately, people who have already filed and suspended are grandfathered in and there is a 6-month grace period within which people 66 and older can still file and suspend up through April 30th, 2016.

The second strategy being eliminated allows workers to file a restricted application for a spousal benefit while allowing their own benefit to continue to grow at 8%. Under the new rules, once workers file for a retirement benefit, they will receive the higher of their own earned benefit or a spousal benefit. However, people who are 62 or older at the end of this year will still be able to file a restricted application at their full retirement age, as long as their spouse has filed and suspended or is taking benefits.  

Spousal benefits were added in 1939 to provide benefits for low-earning spouses. It was around 2009 when people realized that these two strategies, passed at 2 different times, combined to create a strategy that was perfectly legal, but not really what policymakers had in mind, hence the term "loophole." There are certainly many people who think that the File and Suspend strategy is gaming the system. People in this camp say that it runs counter to the intent of the Social Security program which is to replace income lost when a worker retires, becomes disabled or dies, not to allow couples to maximize their retirement income. But it can be argued that these changes are further movement of Social Security toward an income-redistribution program. Two earner couples pay twice as much in Social Security taxes.  They receive much lower benefits than one-earner couples per dollar paid into the system. So is it really unfair that they are able to access ½ of one spouse's benefit while allowing their benefits to grow to age 70?

I hope this helps shed some light on this topic that has gained much attention the past few months. If you have any questions about how these changes affect you or could use some help evaluating your Social Security options, feel free to contact me. If you'd like to access your benefits online, you can use the Social Security's retirement estimator here: https://www.ssa.gov/retire/estimator.html.

Market Flash - Month 2 and No Relief

We're roughly half way through February and globally stocks continue to head lower on really high volatility. Investors have been rightfully nervous watching the major averages swing wildly over so many days. Here are a few statistics showing just how crazy stocks have been this year:

Number of trading days this year - 27
Number of days the Dow Industrial Average has closed more than 100 points - 20
Number of days the Dow Industrial Average has closed more than 200 points - 13
Number of days the Dow Industrial Average has closed more than 300 points - 4
As of yesterday, the Dow is down about 8.5%. These figures don't include today which has been down as much as 420 points.

There is clearly a lot going on here but the question remains, "what's driving this?" There is no shortage of commentaries trying to justify why the markets are down and where things are headed. We too have written several articles sharing our thoughts on the subject. To name a few reasons, we have oil prices, slowdown in global growth, central bank policy changes, the presidential election and the fact that its earnings season. The list could go on. These and other factors are all legitimate concerns, but some are more important than others.

Our position has been that the news related to the energy market, and oil in particular, is the biggest contributor to the volatility we've seen. The proof is in the close real-time correlation between futures prices on oil and the intraday moves in the stock market. In fact, today there was a news release from OPEC that the cartel will be meeting to discuss cutting production. Within minutes, stocks rallied 200 points and this is consistent with what we've seen for the past several months. The biggest moves down in the stock market have occurred when oil dropped below $30 per barrel.

So why is cheap oil such a bad thing? We honestly don't get it either. Originally, the fear was related to the impact on the industry in general, employment and how that would affect certain segments of the financial markets, such as the high yield bond market. Now the discussion has shifted to whether or not the decline in oil prices is an indicator of a significant global economic slowdown (i.e. recession).

We firmly believe that oil is the real culprit in this market. Focusing on that, we believe that stocks are greatly oversold now. We acknowledge the stress in the energy market is real and there could be some spill over into other areas of the economy. But this still is very much an industry specific issue and accounts for a modest percentage of our GDP.

We also think that there is validity to the economic slowdown concerns. But offsetting any negative economic forces is this huge reduction in energy prices to the consumer and businesses alike. I'm sure we've all seen it firsthand. It took $23 to fill my car up the other day. That's down from about $55. Now imagine how that will affect FedEx or Delta.

Transportation isn't the only beneficiary of lower energy prices. Materials such as concrete and aluminum use a tremendous amount of power to produce. The benefit of lower energy prices should be felt throughout the economy. This is a stimulus package that no tax decrease could ever produce.

Our guess is that this year will end up being pretty mediocre for stocks and bonds. This has been, and continues to be, our investment thesis this year. Despite weak growth, the Fed is under immense pressure to raise rates, which should put a lid on bond prices. The global economy is slowing. Even though the U.S. economy is in better shape, it's hard to see corporate earnings increasing much in this environment and we view the lower energy prices as more of a hedge against a recession.

The Slide Continues

We've yet to have any relief from this year's global selloff in stocks. Three weeks into the year and both the Dow Industrial Average and S&P 500 are down roughly 10%. The decline in the U.S. markets is being led by international markets - specifically China and world oil prices.

China's slowdown has investors nervous about the impact on the economies of their trading partners. The Chinese government has proven to be incompetent or untrustworthy in managing their financial markets, currency and economic statistics. So trying to quantify the potential effects abroad has become a bit of a guessing game. As we've mentioned before, the markets hate uncertainty.

Additionally, the resulting decline in commodities prices is causing serious concerns for countries whose economies are primarily built on raw materials exports. The decline in oil prices is the most significant problem for these countries and has the biggest potential to lead to political destabilization. Adding to the worries is the fact that sanctions on Iran are being lifted this week and thus they are now able to sell their oil in the open market. This will only add to the over supply problem.

So should you worry about the stock market? The answer is based on who you are. Participants in specific sectors of the energy industry are, and rightfully should be, worried about their business. The underlying forces that have driven down oil prices are legitimate and likely here to stay for the next couple of years. We doubt the sub $30 per barrel prices are sustainable, but it will likely be a long time before we see $60 (let alone $100). Our thesis has always been that, on balance, cheap oil is a good thing.

 

For the rest of us, this selloff should be seen as a less significant event. It's important in times like these to separate the stock market from the fundamentals. Ignoring the stock market, things look a lot better here in the U.S. We've had pretty good jobs reports the last few months. GDP has been steady and early in the earnings season, corporate profits have been healthy. So we don't view this sharp decline as being driven by the fundamentals.

Instead, this month's market decline appears to be driven by fear and selling pressure from outside the U.S. Our experience has been that these headline driven events tend to be short lived. This is especially true for equity portfolios such as ours. Almost all of our equity positions are constructed using securities that track major indices whose performance is a function of U.S. economic health. We're not making bets on specific sectors of the economy or industries. Therefore, we expect these investments to look past the news and respond to the data over the course of the year, which takes us back to the subject of oil.

Energy costs account for a significant part of everyone's expenses. It's hard to see how a reduction in costs is a bad thing for the rest of us.

A Not So Happy New Year

Technically, this commentary should be about the markets in the fourth quarter, but the real news, and I'm sure what's on everyone's minds, is the selloff in the stock market in 2016. First, we'll dispense with the fourth quarter results.

After a rough third quarter, stocks found their footing in the remaining months of the year and were able to retrace their losses from the summer. The major indices all finished within a percentage point or two of each other at around break even for the whole year. The total return (price change and dividends) for large cap stocks gained about 1% while the small and mid-cap groups were down about a point.

We had felt going into the year that 2015 was going to be a so-so year. These results were slightly lower than we had anticipated, but still mostly in line with our expectations. The volatility was largely driven by renewed concerns over Chinese GDP and the impact of their slowing economy on global trade and commodities demand. This, however, was really more of what we'd call a "headline risk". What we mean by that is the concerns were more about fears over what may unfold in the future as opposed to actual declines in earnings during the year.

The real news in 2015 was that the Federal Reserve officially kicked off their long awaited rate hike campaign. The first interest rate increase was only 0.25% (coming up from zero), but it signaled the official end of the easy money policies and Fed guided market support over the last eight years. This move was long awaited and had been pushed back several times. They probably waited longer than they should have by starting this process last month, but now that they've made their first move, it's expected that they'll steadily continue raising rates for the next few years.

It's believed that the Fed would like to increase the Fed Funds rate up 1% per year for the next three years. This would put the Fed Funds rate at 3%, which is still roughly a point below the historical average. That pace would be pretty aggressive and would be predicated on the stability of the global economy and the U.S. dollar.

This has set the stage for 2016. As of this writing, both the Dow Industrial Average and the S&P 500 are off almost 8% and the NASDAQ is down nearly 10%. Those are very sharp declines in just two weeks. There are three principal reasons for the selloff. In no particular order they are: China GDP, the value of U.S. dollar and the price of oil.

Of the three, we believe the Chinese economic slowdown is the least significant issue. That's not to say that the news isn't having an impact on stock prices, but once again, we believe this is a headline risk and the impact will be overshadowed by other events (good or bad) in the near-term.

The strong dollar is another area of concern for the stock market and is the direct result of the Fed's decision to raise rates. Globally, rates are extremely low and investors are desperately seeking yield.

Higher rates make our debt investments more attractive to foreign buyers and increase the demand for the dollar. A strong dollar, in turn, makes goods and services produced by U.S. firms more expensive abroad. Large U.S. firms derive a meaningful part of their revenues form exports so it's easy to imagine how their sales may be affected by a stronger dollar.

The final market driver of late is the collapse in the price of oil. The price of a barrel of oil dropped below $30 this week. That's a price no one thought we'd ever see again. This rapid decline has put into question a whole host of issues. They range from the impact of political stability in the only functioning governments in the Middle East to the solvency of the high yield debt market.

We're less concerned with the political implications of low oil prices. Most of the oil producing nations are tenuous at best and while low oil prices make the situation worse, they are hardly the cause. More importantly for the stock market is how bad will the energy sector be hit and how will that effect the rest of the economy.

This question is what has directly led to the selloff this year. We acknowledge that there will be a lot of pain felt in the energy sector. There will also be many companies in the exploration business that won't survive this. Many of them have also borrowed a lot of money that won't get paid back and their banks and bondholders are going suffer losses. That is all true. What is also true is that significantly lower energy prices will have a huge positive impact on a much wider segment of the economy and corporate earnings.

We wrote about this last year and named just a few of the beneficiaries of low oil prices. The list is quite large and stretches across the whole economy. It may be a few quarters before Wall Street sees the impact show up in firms' quarterly earnings, but we have little doubt that it will. It's for this reason we feel that these low oil prices will be a net plus on the U.S. economy and the S&P 500 earnings. Therefore, we view this recent decline in stocks as temporary.

Looking ahead at 2016, we think the bigger driver of the markets will be the Federal Reserve. The timing and degree to which they increase rates will have a lot to say about the stock market. Our guess is that they'll take it slow. That being said, any increase is going to be a strong headwind for the stock market. More importantly, the inevitable uncertainty surrounding the Fed's moves alone will lead to a lot of volatility.

As far as the immediate drop in the market is concerned, this is not a long-term selloff because stocks are overvalued. Instead, we think these losses will reverse themselves in the coming weeks as oil prices stabilize. We do expect this to be another up and down year as higher earnings forecast battle rate increases. Our expectation is that this will be another mediocre year for stocks, but we are looking forward to higher rates for bondholders. It'll be interesting to see how the markets stand on their own without the Fed propping them as they have over the past seven years. That's the real question.

3rd Quarter 2015 Commentary

Volatility is King 
 So where do we begin?  The third quarter of 2015 was undoubtedly one that we all would like to forget.  In fact, we’ve fielded a lot of questions by anxious clients over the previous weeks wondering how we see the markets and the economy in the near future. Those are challenging questions to answer.  Investments of all types have struggled lately and the traditional safe-haven asset classes haven’t proven to be effective either.  In real terms, even cash is losing around 1.5% a year as evidenced by the fact that the Treasury has issued over a trillion dollars’ worth of one and three month Bills at an interest rate of 0%.

The depth of the quarter’s decline was very broad as the following table shows.  As bad as these numbers appear, they don’t even show the worst of it.  The S&P 500 was off as much as 11.4% near the end of August.  The other indices were down similarly around that time.  Alternative asset classes such as commodities suffered even worse losses.  The Dow Jones commodity index lost 12.7% for the quarter.  

These are very strange times and people are concerned that we’ll have another selloff like we saw in 2008.  While the general trend in the quarter has been sharply lower, it hasn’t been all down. Instead it’s been a whipsaw.  One day the news is perceived as highly discouraging and the next it’s not so bad.  This has led to massive money flows in and out of various asset classes and thus the seemingly endless triple digit swings in the Dow Industrial Average. 

The theme damaging to both the stock and bond markets (here and abroad) is uncertainty.  As of now, we have a number of major issues causing this heightened sense of uncertainty.  The market is uncertain as to when and if the Federal Reserve will start the process of interest rate normalization and begin raising interest rates in the future.   There is uncertainty given the economic slowdown in China which caused their stock market to swing wildly and eventually spilled over to stock markets around the globe. The collapsing oil and commodity prices is another sore spot and is a source of major uncertainty. 

The volatility has continued into this month (thankfully to the upside).  As of this writing, the Dow Industrial Average is down only 3.4%.  Our expectation remains that stocks will generally finish flat or with modest gains this year.  The fourth quarter is usually a pretty good quarter for stocks.  Since the early 1990s, the broad U.S. stock market, as measured by the Standard & Poor's 500 index, has declined in value in the fourth quarter only two times. The average gain in the 13 instances where stocks have risen in the final three months of the year is 6.3%.  If something similar holds true this year, the market would finish up about 1%.  With dividends, the total return would be around 3% - right in line with our expectations.

The Pursuit of Income is Sometimes a Bumpy Road
 In 2008, the S&P 500 lost over a third of its value.  It wasn’t until sometime in 2012 that the market fully recovered.  Stocks traded in 2009 at values similar to the height of the dot-com days at the end of 1999.  These are long periods of time that stocks essentially had zero return.  But inside of those periods, a lot of gains could actually be had.  To be a successful investor, you have to be able to buy and sell when it’s right for you, as opposed to something or someone else dictating when you make those trades.  Those outside forces could be anything from a margin call to needing to raise cash to pay your bills.  This is one reason income is so important to investors’ total return. 

Income gives you the predictability and liquidity that allows you to ride out bad markets.  This couldn’t be any truer than for retirees.  Also, having the ability to rebalance in good times and bad is key to taking advantage of wild market moves.  Portfolio income can keep you from having to sell into a bad market or build up and give you the liquidity to buy into one of these selloffs.  We actually used the sharp decline earlier this quarter to increase our equity holdings.  The funds we used were largely cash from interest and dividends that had built up. To generate this income, we have typically used high credit corporate, municipal and agency bonds for our fixed income allocations. But those are not an option at this time due to the extremely low yields in those markets.  In 2007, we could easily have bought “A” rated or higher corporate or agency bonds yielding around 7%.  Those bonds today would yield less than 2%.  It been this way for many years now and the ones we have owned are now paying off.  This has forced us, and all traditional bond investors, to look to alternative sources for income. 

We now hold a wide array of income producing securities in large percentages relative to our usual bond allocations. Examples would include high yield bonds, preferred stocks, MLPs, closed end funds, and bank loan funds.  These alternative income producing securities behave very differently from traditional bonds. Adding these alternatives to our portfolios have allowed us to keep up with our income requirements, but it has come at the cost of price volatility. 

In more normal times you’d hardly see any change in value in the fixed income portion of your portfolio from month to month.  That has not been the case lately as the prices for these alternatives have been affected by the same forces driving the stock market. This is especially true for high yield bonds and MLPs.  While we don’t like to see price pressure on these securities, the trade-off has been, and will continue to be, much higher income.  Our goal is to slowly work our way out of these positions and back into bonds but we have to wait until bond yields improve dramatically from here.  That could be years.  When all is said and done, though, we expect to sell these at prices around where we bought them and simply have our holding period return be based on the cash flow – somewhere around 7%.

Market Flash Part II

The wild ride continues today.  As I’m sure anyone with so much as a radio has heard, the Dow Industrial Average opened and promptly sold off almost 1100 points.  Regardless of who you are or what you do for a living, that’s not easy to watch.  After bottoming within a few minutes after the markets opened, the major indices quickly cut those losses significantly.  It’s still going to be a crazy day, and likely week, for stock investors.

This is all being driven by the topics we wrote about Friday but probably is worth diving into a little deeper today.  To start with, it’s worth saying that an investor should never trade in a volatile market like we’ve had today. Traders on the other hand, (good ones), love days like this. 

I would define stock investors as people who are buying equities based on multi-year trends and fundamental analysis.  They are reasonably expecting to see the share price change over time based on average increase in earnings (per share profits) of that stock or group of stocks (index) over their holding period.  For that expected increase to hold true, the average must be realized over at least several years. This is because funny things can happen in any given year or two, but seldom over longer periods of time. 

It is also important to understand what you’re buying when purchasing a share of stock.  The share price should represent the current value of all the future profits of that company.  If you’re buying an index, like we do, then it would be the future earnings of all the companies in that index.  For the share price to go up, the earnings must grow year over year.  The earnings growth of an index tends to be fairly predictable and this is why we view them as a safer way to invest than buying individual stocks.  Something unexpected can happen to one company that can impair their earnings for a long time. 

The biggest risk to stock investors usually comes from themselves.  Everyone knows that to make money in stocks you need to buy low and sell high.  However, most people’s natural instinct is to do just the opposite.  They see a big move in the markets and feel like they need to do something about it.  The reaction today would be to sell when the Dow was off 8 or 9 hundred points.  Two hours later the Dow is off 300.  By being “safe” they just lost a 3% spread. 

Days like this are for traders.  Traders love these markets.  To be successful, traders need volatility.  The more volatility the better their chance to profit.  It’s also fraught with the potential for losses.  But that’s the game traders signed up for.  To be a successful trader you want to look for stock prices that have become disconnected with reality or where there’s a big imbalance between buyers and sellers that you think will get corrected in the coming hours.  These opportunities are hard to find during normal trading days, but plentiful on days like this. 

So let’s look a little deeper into what’s driving the stock market lately.  We had mentioned Friday that the markets were taking their lead from the events in China.  The reason for this is that China wields a significant amount of influence over global trade due to their 1.4 billion person consumer base and $11.2 trillion GDP.  With those sort of numbers, it’s hard for businesses not to have some level of contact with them. 

As China’s influence has grown, so have the concerns about them.  We live in a very connected world and you can’t help who you’re competing with.  A U.S. auto manufacturer has to compete with a Chinese manufacturer for the same steel.  The same holds true for the Indian power plant buying coal or a Japanese firm buying semiconductors.  Firms also don’t have to sell directly into the Chinese market to be effected.  Their product may be one part of something else that is sold in China.  Chinese firms are out there bidding up prices on parts and materials that are used worldwide. 

One of the biggest concerns is the lack of transparency in the country.  China is ultimately a communist country with very loose standards when it comes to laws and regulations.  Economic news and statistics are carefully filtered by the government so no one is really sure if they can trust the official information released – assuming it even is released.  This makes getting at the truth a bit of a guessing game and analysts have become very creative at figuring out what is going on. 

The current drama is centered on the health of the Chinese consumer.  We know that individual debt has been rising in the country and that many Chinese investors have lost significant sums of money in their stock market this year.  We know the situation is bad because of the extraordinary measures their government has taken in an effort to reverse those losses.  In a true central planning way so common in communist regimes, the government has placed a number of trading restrictions and purchasing plans in place to stem the flow of losses in those markets.  This combined with a currency devaluation by their central bank have failed to turn the situation around.  Thus the global markets worry that things are spiraling out of control in China. 

Financial markets loath uncertainty and there is a lot to be uncertain about.  Thus we have a global selloff in stocks.  Our view is that the response is overblown.  While these concerns are legitimate, when you put the numbers to the possible outcomes, the economic impact to our economy doesn’t justify the level of panic we’re seeing.  This feels like a purely news driven event and not one based on the fundamentals.  History has shown that those types of selloffs tend to reverse themselves quickly.  This in no way looks like the last correction we had in 2009. 

Market Flash August 21, 2015

The Return of the Summer Swoon

By Charles Webb

It’s August.  That means it’s that traditional time of year when the stock market sells off and the financial news commentator’s favorite term, “market correction,” starts to get thrown around in earnest.  The reasons for the declines are seldom the same, but oddly the season seems to be connected somehow.  This year’s selloff has been brought to you by the Chinese. 

The world’s second largest and fastest growing major economy is beginning to show signs of age.  Just as trees don’t grow to the sky, national economies can’t exhibit rapid growth forever. They begin to reach maturity at some point.  China’s GDP is expected to reach $11.2 trillion this year.  That’s up from $10.4 trillion last year or up 6.8% (calculated in yuan), but well below the 2014 increase of 7.4% and 7.8% in 2013.  Their latest 2016 GDP forecast is looking for a 6.3% increase. 

Clearly, China’s size is making it difficult to sustain the growth rates we’ve seen in the previous years.  To be clear, 6.8% is still twice what a healthy and mature economy typically grows by, but it’s the trajectory that is catching people’s attention.  There have also been a number of questions raised in recent months about the health of several key segments of China’s economy.  Most notable of those are the number of bad loans sitting on the books of China’s banks.  How much? No one really knows what the truth is, but it’s probably big and could challenge their banking system. 

Experience has shown that this could have a substantial effect on China’s GDP for several years.  These concerns are reminiscent of our own debt crisis from a few years ago.  Large write-downs impair banks’ ability to lend, growth fueled by debt dries up and then a recession ensues.  There wouldn’t be the contagion to other countries like we had in 2008, but the impact would surely be felt around the world due to China’s trading influence. 

All of this leads to the question of what the impact on the earnings will be of all the big multinational companies that do business in China.  Once again, it’s hard to tell, but it could be significant.  A good example is Apple (AAPL).  China is a huge market for Apple and this uncertainty has driven their stock price down by almost 20% over the past month.  Apple has the largest market cap of all U.S. companies and thus is the biggest component of the major indices.  It’s easy to guess what a 20% decline in the largest member of an index will do to that index. 

Just as Apple’s business would be impacted by a Chinese slow down, others would be impacted, too.  And it’s not just companies that sell to the Chinese consumer but also companies that sell into their manufacturing base.  Materials and energy firms are taking the biggest hits this month.  As you can imagine, China has been a huge consumer of those materials and responsible for much of the prices of those goods.  A possible slowdown in their manufacturing base would obviously lead to a decline in raw material costs.  That’s not a bad thing for consumers but the companies that produce those materials also trade on the stock exchange. 

We’re also headed into September when the Federal Reserve has stated that it’s likely they’ll start raising rates.  If August continues to decline, they may hold off on that move.  That would be a powerful counter to the earnings concerns. 

What we are witnessing is the market trying to reprice these possible outcomes.  As with every large market move, the initial market reaction is to sell first and figure it out later.  There’s no telling where things will settle out, but you can be sure the reaction will always be overblown.  Our view is that while these concerns are legitimate, the market reaction is based on sentiment and not the fundamentals.  We still think that stocks will finish the year with slight gains.  As of this writing, the S&P 500 is down YTD about 4%.  It’s down a little over 7% in the past 3 months.  So a 3 or 4 point swing around breakeven is certainly not out of the ordinary and certainly something that can swing back the other direction within the coming 4 months. 

Today, (8/21/2015), the Dow Industrial Average has traded as low as -530 points.  That feels scary.  If our clients had to sell into this market, it would in fact be a big deal.  If you’re not in that position, however, this really isn’t so bad.  The market is basically where it was last October.  I don’t recall any of the news commentators worried then.  These days are far more relevant to stock and options traders.

This is just part of being a stock investor and also why we own bonds and other income producing securities that aren’t correlated with the stock market. In the meantime, we’ll sit back, collect our dividends and add to our positions at lower prices.  I doubt that in 5 years anyone will remember what the stock market did today any more than what the weather was.