One Year Reflections

Posted by on 08/20/09 in Entrepreneurship, Global Politics, Markets

One year ago today (August 20, 2008) we launched Syntrinsic Investment Counsel, LLC. We have been incredibly fortunate to have earned the support and confidence of so many good people. Thank you for being a part of what we hope becomes something special over time.

While every year brings its own fascinating challenges, this past one has been particularly intense socially, politically, and economically. We have been reflecting on where the world was this time last year and had a few startling (and a few funny) reminders along the way.

As we’re sure you remember:

  • At market close on launch day, the Dow stood at 11,417, about 23% above the current 9,315.
  • George Bush was President.
  • Oil stood at 113 versus 67 today.
  • Barack Obama was en route to Denver to accept the Democratic nomination.
  • Few people had heard of Bernie Madoff. Those who had heard of him thought that they were lucky.
  • Citigroup was trading at about 17.5 (now trading at 4.3), AIG over 400 (now 26.6), and GM at 10 (now trading as Motors Liquidate at 0.90).
  • Sarah Palin was a relatively obscure governor of Alaska. Now she is neither.
  • Many thought that the worst of the US stock market correction was over (the S&P 500 actually rose in August 2008 before a precipitous September-October-November 20 decline of 42%).
  • Lehman Brothers was a major investment bank (until mid-September).
  • Many hedge fund investors still did not know what “gates” were or how easy they were to put up.
  • Inflation as measured by CPI stood at 5.6% (the highest in 17 years), just prior to massive negative changes in CPI in October and November. CPI this week is at 0.0%.
  • The Olympics in China were proceeding without the hitches many had expected. Few outside the State Department had heard of Uighers.
  • Health care reform was something from the early 1990s.
  • Town hall meetings were generally confined to small towns in New England.
  • Former Goldman CEO, Hank Paulson ran the US Treasury Department while former Goldman Chairman, Stephen Friedman, ran the New York Federal Reserve. Goldman stock was at 158 one year ago; it is at 158 today. Curious.
  • The Tamil Tigers controlled much of north and east Sri Lanka.
  • Stanford Group was selling 10% CDs issued by their bank in the Caribbean.
  • Housing starts of 950 million in August 2008 had economists wondering if the housing market had stabilized at last.

Yet some things have not changed much at all. Many investors still seek clarity and candor, while some still seek the silver bullet. Most Americans want the government to take care of us yet leave us alone at the same time. People care at least as much about not losing their wealth as they do about growing it. Some truths just become more clear.

And this year the many reasons we formed Syntrinsic have been validated, reinforced and grown stronger. Many industries are going through profound changes, the companies within those sectors compelled to reorient and re-strategize. We have been asked 100+ times if in hindsight we are glad that we launched Syntrinsic when we did. Absolutely.

Given our value system, mission and clientele, this past 12 months has provided nearly constant affirmation, with positive reinforcement from long-standing and new clients alike, as well as from friends and community members who believe in how we do business.

Thank you for your support over this past year. We appreciate this opportunity to serve.