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INFLATION CONSTERNATION
What is Federal Street doing about it?
By Kristin Fafard
We've been asked by many of our clients about whether we are concerned
about inflation and if so, what we are doing about it. The purpose of this article is to discuss why
it has become such a hot issue, how we believe our clients are
currently protected in the present environment, and how we may consider doing
even more if the conditions warrant.
Click here to download the report in PDF format.
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FEDERAL STREET HITS THE STREET
Many of
the staff at Federal Street
have been out and about recently as part of the firm's effort to participate in
professional discussions that are taking place.
Here are a few highlights: - Senior Research Analyst, Emily Bannister,
attended the Boston Security Analyst Society (BSAS)'s January 12th presentation
entitled "Municipal Bonds and the Great Financial Crisis." Emily heard Matt Fabian, managing director of
Municipal Market Advisors, and Adam Weigold, vice president of Eaton Vance
Management, review the municipal bond market's reaction to several major
events, including the shut-down of the auction-rate preferred market, the
credit crisis, the recession (which has had a significant impact on municipal
budgets), and the creation of fully taxable Build America Bonds which can be
issued by municipalities as part of the federal government's stimulus
program. Afterwards, Emily joined with other BSAS members in a discussion
of the credit quality of municipalities.
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John Przybylski, director of financial planning, attended the 44th Annual Heckerling Institute on Estate Planning,
the largest gathering of estate planning professionals in the country. A
full week long, the Institute covers current issues in the field, and there was
a lot to cover this year. One of the major topics addressed was the
temporary repeal of the estate tax for 2010 as well prospects for a repeal of
the repeal, and whether that would be retroactive to the beginning of the year
or not. Also discussed was the lifting of the income cap for Roth IRA
conversions done this year.
-
Director
of Foundation Services, Jennifer Christian
Murtie, attended the Council on Foundations 2010 Family Philanthropy
Conference in San Diego last month. Attendees were treated to topics that
included, "Who is Family? What is a
Philanthropist?", "Strategic
Philanthropy: Vehicles for Getting it Done", "If I Knew Then What I Know How: New Thoughts on Managing Philanthropy
Assets", and "Mission-Related
Investing and Program-Related Investments: Opportunities for Philanthropic
Organizations". In addition, several
plenary sessions addressed issues of communication, technology and changing
demographics. Jeff Jarvis,
author of the book What Would Google Do? closed out the conference with an eye opening message about the future of
philanthropic efforts in an age of rapid technology transformation.
If you have
interest in any of these subjects, give us a call as the people who attended
would be more than happy to discuss them with you.
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VIEWS FROM THE RESEARCH STAFF
In
January, Federal Street's
research staff held a series of routine due diligence meetings with a number of
recommended long-only and hedge fund managers. The overwhelming view was that,
despite the 2009 rally in stocks and bonds, there are still pockets of
opportunity in the markets on a security by security basis. A fallout of the rally, however, is the fact
that some stocks and bonds did rise above fair values to the point where the
hedge fund managers have many more short opportunities to pick from. While opportunity remains, careful security
selection is more important than ever given the fragility of the economy and
the overall valuations in the marketplace.
Consistent with our views, one overriding macro concern remains the ever
growing global government debt and its corresponding impact to the financial
markets.
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BOOK PICK: Forces for Good
Our book
pick this month comes from Jennifer Christian Murtie and, while not a new
release, it is a book that remains a must-read for anyone with an interest in
the future of philanthropy and non-profit organizations. The
Economist agrees with Jen and puts "Forces
For Good: The Six Practices of High-Impact Nonprofits" by Leslie Crutchfield
and Heather McLeod Grant
on its list of "Top 10 Business Books of the Year."
The
authors posit that "it is the end of charity as we know it, and the
beginning of high-impact philanthropy" and go on to analyze the top six practices
of twelve high-impact organizations. Those
who are interested in how non-profits run themselves will find this to be one
of the best written books on this topic and a guiding light to help evaluate
giving going forward.
(Click the book to go to Amazon or here for our reading list)
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As
always we thank you for considering Federal Street Advisors when looking for an
investment advisor or family office services for your clients.
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