Joseph G. Witthohn, CFA
VP of Product Development Emerald Asset Management

Good morning.

Stock are lower this morning as the number of new virus cases was the highest seen yet … but it is unclear if this will translate into a greater number of fatalities for the number of “deaths per day” has been trending downward over the last two months.

The big business news story of the night was probably concern over bank “stress tests” performed by the Fed and expected restrictions on dividends and share buybacks in order to help assure solvency. What is interesting to note is the Fed’s comment on “… economic uncertainty from the coronavirus event.” One thing we all have gotten to understand of late is “uncertainty” … since no one seems to know what tomorrow will bring.

What do I mean by that? Imagine being a small business in Texas. Just a few weeks ago Texas ended its “stay-at-home” policy and many places reopened to great fanfare. Now the number of cases has taken a parabolic move upward over the last 10 days, causing some businesses to voluntarily close and the governor made an announcement that individual counties and cities can mandate masks be worn… but the state will not do so at this time. I guess there is an election coming up.

It appears that masks work (when worn correctly) and, according to an ABC poll, around 87% of us wore them in the last week when venturing outside. The other 13%? Don’t get me started. Just seeing the amount of cases and, importantly, hospitalizations … should be enough to convince doubters that mask wearing is something they should adopt.

I took a drive last night to Shake Shack (my son’s new addiction) and drove through a business park which I was in around 3 months ago. Noticeable were the high amount of vacancy signs for office space. These were not small buildings as the office park website claims 1.6 million square-feet of space now available for rent. I am afraid we will see more of this in the coming months as low-margin restaurants are forced to close and companies realize how easy it has been to have some employees work from home.

I hate to end the week not only with a down market, but with a boring note.

… but I’ll end it here regardless … and think of what to do the remainder of the day.

I think instead of Shake Shack … I’ll try out this District Taco place as it is pretty popular.

“I don’t like tacos.” Said no Juan ever.

Have a great weekend,

Joseph G. Witthohn, CFA
Vice President
Emerald Asset Management PA, LLC
610 Freedom Business Center Drive
King of Prussia, PA 19406
Direct: (610) 285-9905
cell: (856) 625-7915
wit@teamemerald.com
#flattenthecurve

… as of 10:58 AM today …

Quick Look at the News

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