A Strong Finish to 2010
The fourth quarter of 2010 produced very strong returns for all equity asset classes,
with big rallies in December, as good holiday sales and an improving jobs environment
spurred increased consumer and investor confidence.
Small cap stocks (domestic and overseas), emerging markets, and US and overseas REITS
outperformed global large cap stocks. Aspiriant’s clients are very broadly exposed to
these opportunities and despite relative weakness in developed overseas large cap stocks
(up about 8% for 2010, as a whole, compared to the 15% gain for the S&P 500) and with
fixed income returns generally, at about the 6% level, almost all client portfolios
enjoyed gains well above 10% for the year.
Municipal Bonds: Reports of their death have been greatly exaggerated
Whether you’re a muni bond investor…or a user of municipal services…or a taxpayer, you need to understand what may be in store for the muni bond market. We have better news for investors than they might expect though no great consolation for service users or taxpayers.
From the CEO
2010 came to a close with another very good quarter for our clients’ portfolios,
capping an excellent year overall. Many of our newer clients are enjoying investment
results accumulating to more than 50% over the past two years and many longer-term clients
have recovered a very substantial portion of the losses incurred in the global financial crisis
of 2008 and early 2009.
New Tax Law
On one level, this is all good news: no increases in income tax rates and some small FICA tax
savings (but still worth putting to work) and enhanced shelter from taxes on wealth transfers by
lifetime gifts or at death. For quite a few clients, gift, estate, and generation skipping taxes
have become irrelevant.
The bad news comes in two parts: the property transfer aspects of estate planning have become even
more complex for many, especially those whose total estates are under $10 million, and this resolution
of uncertainty lasts for only 2 years. If Congress and the President can’t come to some new, long-term
agreement, we’ll be back to the unknown at the end of 2012.