The recent trend in U.S. residential housing conditions is downright discouraging for those trying to buy a new home, and even worse for those looking to buy their first home. Ongoing supply shortages in the housing market have pushed the median price for an existing single-family home 50% higher than pre-pandemic levels. Meanwhile, the Federal Reserve has been lifting interest rates for 18 months in its effort to cool inflation, which has resulted in a 23-year high in mortgage rates. Rising house prices coupled with rising mortgage rates mean housing affordability has become very unaffordable.
Q2 2023 Market Outlook
It’s been more than three years since the pandemic began, and thankfully the worst is behind us, but the global economy is still dealing with the ramifications of COVID. Debates remain on whether a recession is upon us or not and how deep it could be, while economic data continues to be mostly positive. Last quarter, we wrote about one of the negative implications of the fast tightening of monetary policies by the Fed which contributed to the failure of a few banks which were especially vulnerable. This created some social and market anxiety about the safety of deposits and potential systemic contagion, that have now stabilized, as we thought they might.
Q2 2023 Impact Update
This quarter, our work continued in earnest, focused on international and domestic advocacy across some of our largest holdings. Despite setbacks in this season’s proxy voting results, driven mostly by right wing opposition to sustainable investing, we are empowered by our partners and stakeholders.
Zevin Asset Management ESG Strategies Named to List of Best Performing Strategies for Q1 2023
For the fourth consecutive quarter, Zevin Asset Management’s Global Equity strategy has been named to the PSN Top Guns List of best performing separate accounts, managed accounts, and managed ETF strategies. Zevin Asset Management's Global Appreciation with Income strategy has also been named to the same list for the second time. In addition to Q1 2023, the firm received the same recognition for its Global Equity strategy in Q4 2022, Q3 2022, and Q2 2022. The highly anticipated list, published by Zephyr, remains one of the most important references for investors and asset managers.
Read our statement to learn more about this recognition of the benefits of our impactful ESG strategy.
Whistling Past the Graveyard or Perfect Foresight?
Whatever happened to the old saying “don’t fight the Fed”? Typically, when the Fed and other central banks raise interest rates to cool inflation, an associated and necessary result is economic activity and corporate earnings slow, so equity markets sell off in response. But year-to-date the global benchmark All Country World Index (ACWI) has returned almost 10% and has largely ignored the fact that we are still in the midst of the most aggressive monetary tightening cycle since the 1980s. Starting in the first quarter of 2022, the central banks of the G10 largest economies have increased policy rates by a whopping 24% in aggregate. Meanwhile, central banks are also withdrawing stimulus through their quantitative tightening programs. But all the while stock markets have spent 2023 so far merrily (or recklessly?) marching higher.