BlackRock Conference Call Summary

Dear Friends and Clients,

As a follow up to our conference call with BlackRock Funds, I am happy to attach a copy of the call for you to listen to again if you would like to, or if you did not get a chance to listen on Friday. The comments from our speaker, Blackrock Funds Director and Product Strategist Dan Coppens, are still very relevant. We were pleased to learn that over 140 people decided to join the conference.

A few takeaways from Dan were:

  • Although the market staged a historic three day rally last week, there is still some selling that needs to take place in the market in order for a firm bottom to be established  (Translation: we are not out of the woods quite yet)

  • The bond market has seemed to calm down, and liquidity and yields are beginning to return to normal.

  • The biggest concern right now is if the economy will fall into a deep recession before the virus peaks, causing the bounce back to be longer and more difficult. Ideally, the virus will hit its apex before the economy tips over.

  • The Federal Reserve is buying $75 billion in bonds across the spectrum on a daily basis. This is unprecedented action on their part.

  • Over the past six weeks investors have parked $286 billion in money market funds waiting to be redeployed into the market.

When the opportunity presents itself, we will arrange a new call down the road. In the meantime, please feel free to contact us with any questions.

Sincerely,

Michael Hartzman, CFP          

Lebenthal Financial Services, Inc.

516-349-5555

Dominick Tavella

Lebenthal Global Advisors

516-785-1800

A Message from President, Michael Hartzman

Dear All,

I hope this finds you safe and in good health. Today I was invited to participate in a conference call with Blackrock Funds and to hear the insights of the Chief Executive Officer, Larry Fink, and the Chief Investment Officer, Rick Rieder.

These two gentleman are among the brightest and well tuned-in men on Wall Street. I am happy to share their thoughts with you.

According to Larry Fink:

  • As it relates to the Coronavirus and the effects on the market, he sees this as a twelve to fifteen week process to return to normal. That is how long it will take to get the number of new cases to peak, and then to finally abate.

  • This is not a financial crisis. Banks across the world are acting together in a coordinated effort to keep liquidity going.

  • It will take about three trillion dollars from our government to help individuals, small businesses, and corporate bail outs to the industries that need it most.  

  • The opportunities in the market are substantial right now. This is not the time to be selling, but the time to be accumulating cash and jumping in once the virus numbers start to decline in America.

  • Some companies are positioned to prosper in this period, such as Kroger, Netflix, Amazon, Walmart, and McDonalds, to name a few.

  • The industries that have been hit the hardest will bounce back (ex. airlines, hospitality, cruise lines, insurance companies)

According to Rick Rieder:

  • The Fed is not out of tools to help the economy, and they are doing a very good job in providing liquidity to financial institutions.

  • The Markets will potentially fall some more. However, once we reach stability, we will then see the rebound.

  • The bond market has seen unprecedented volatility, but this will also begin to stabilize.

As far as it goes at Lebenthal Financial, we all have begun to work from home and to follow the protocols suggested. Rest assured we are fully functional, and have been preparing for this possibility for several weeks. Your portfolios have held up well during this period, and I am happy to review your account in detail at any time.

Stay safe and out of harms way,

Michael