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Market Viewpoints

by Keith Bonjour, Portfolio Manager

The markets continued to pull back for almost the entire duration of the fourth quarter with the largest drops coming in October and December. U.S. equities fell almost 20% from their peaks with the S&P closing down 14.3% for the fourth quarter followed closely by international equities. Stocks did stage a small recovery after Christmas through the close of the year, and the rally has continued into the new year. Market sentiment shifted dramatically from a generally positive outlook for most of 2018 to very negative to close out the year. The Federal Reserve hiked interest rates for a fourth time for the year in December, and markets clearly did not like the decision based on the stock market performance. U.S. stocks had held up well for most of the year, but finally broke down after determining that the Fed’s outlook for 2019 was too aggressive and were hiking rates too quickly. 

Commodity prices were also down heavily for the year with oil prices falling 25%. The best performing asset class for 2018 was cash after the fourth quarter wiped out U.S. Equity gains for the year. 2017 was a year of risk-on trades for the market and while 2018 started out strong, that optimism faded as worries began over a global growth slowdown, a possible inverting of the yield curve, the Federal Reserve hiking rates too quickly, and an escalating trade war with China. These factors outweighed the positive contributions from the large corporate tax cuts, low unemployment, strong GDP growth, and overall large corporate earnings that had been boosting the market early in the year. 

The Federal Reserve pushed ahead with four interest rate hikes by 0.25% each quarter in 2018, after hiking rates 3 times in 2017. This brings the Federal Reserve rate to a level that is getting closer to neutral per Fed Chief Powell. We will be monitoring the Fed discussions very closely in 2019 to determine the Fed’s trajectory of future rate hikes. The last couple of weeks have given us a more dovish stance from several Fed governors, which seem to signal an interest in slowing down on rate hikes going forward. We think it would be prudent for the Fed to take a more cautious approach to raising rates in 2019 since inflation remains well anchored around 2%. Unemployment also remains extremely low at 3.7%, thought to be around the natural unemployment rate. However, wage growth was 3.1% for the year, which has improved, but not enough to indicate upward pressure on inflation.

Discussions between the U.S. and China have continued to progress on trade since President Trump and President Xi agreed to a truce on any new or increased tariffs through March 1, 2019. Thus far, discussions seem to be moving in the right direction with each side sharing some optimism over a future deal. Both sides have several motivating factors that we feel will push them to try to make a deal before the end of 2019, but could come much sooner. As stated in our previous article, we continue to invest for our clients based on your long-term investment objectives and not short-term movements in the market. We have maintained a neutral stance on equities; however, we did reduce our exposure a small amount in our November 2018 rebalance. We continue to be underweight in fixed income, while slightly increasing our exposure to bonds and focusing on shorter durations to help protect against rising interest rates.

Welcome Blair, Westfall and Company

By Joe Slavens, President/CEO

Our mission has always been to combine years of experience with an entrepreneurial spirt to create better solutions that help clients achieve better results. In 1969, my uncle Jim Slavens started our Trust Department to provide trust and estate administration services to our customers. Now known as our Investment Management Group, over the past 50 years we have added services to assist with retirement planning, charitable giving and investment management for individuals and non-profit organizations. 

As we begin 2019, it is my pleasure to announce that we have taken another step in furtherance of our mission by acquiring Blair, Westfall and Company, a second-generation family-owned Quad Cities accounting firm. 

A longtime friend, CPA Glenn Blair, founded Blair, Westfall and Company and our Investment Management Group has worked with the firm’s professionals for decades. We are thrilled that Amy Westfall, Glenn’s daughter and also a friend and CPA, has agreed to continue to lead Blair, Westfall and Company and its delivery of tax return preparation, tax planning, payroll and accounting services to both individuals and businesses as a part of the Northwest Bank family. 

Blair, Westfall and Company currently has its main office at 4427 E. 56th St. in Davenport and another office in Milan. To enhance the convenience of working with our entire team, this summer the Davenport office will move to the 8th floor of our NorthPark Tower and share offices with our Investment Management Group. 

We are confident that Amy and her staff will be great additions to our team of trust and estate, retirement planning, investment management, insurance, and now, tax and accounting, professionals. Please contact any of them to see how we can help you achieve your financial goals.

A Note from Amy Westfall

The New Year brought exciting changes for Blair, Westfall and Company with the sale of the firm to Northwest Bank. My role has changed to manager instead of owner, but my team and I are still doing the same accounting and tax work as we have been for the past nine years. I am very happy about this opportunity. 

Making the decision to sell Blair, Westfall and Company was a very difficult decision but one I needed to make. I knew it was important to find the right buyer. Northwest Bank is a family owned bank that has been part of the Quad Cities community for over 75 years. I know they share my values and dedication to customer service. It’s a perfect fit.

Joe Slavens and his team have worked to make this transition as seamless as possible for the Blair, Westfall and Company clients including retaining our accounting staff, which you can read more about inside the newsletter. We will be staying in our current location through June. After that, our Davenport office will move to the 8th floor of the Northwest Bank Tower and share space with the bank’s Investment Management Group. Our Milan office will remain open.

We have had a long relationship with Northwest Bank’s Investment Management Group and I am excited to get to know more of the bank’s customers. I look forward to meeting as many of you as possible, but in the meantime, if you are interested in learning more about the services we can offer you, I encourage you to reach out to me at or 563.514.5522. 

Blair, Westfall Team of Professionals 

Amy Westfall
Amy manages Blair, Westfall and Company, Northwest Bank & Trust Company’s newly acquired accounting firm. Amy earned degrees in Psychology and Sociology from the University of Iowa before graduating from Western Illinois University with a degree in accounting. Amy has been in the accounting industry for over 14 years with experience in both local and private sectors. Before Amy was named partner at Blair, Westfall and Company, she worked as an accounting clerk for multiple manufacturing companies and served as an internal auditor for a local casino. She is a board member and committee member for Finance with the John Deere Classic and a community volunteer for a Genesis Health board committee.

Kristi Adams
Krisiti has over 10 years of experience in the accounting field working in many areas including accounts payable, accounts receivable, bookkeeping, and payroll. She is a graduate of Alabama A&M University where she earned her degree in Accounting with a concentration in Financial Accounting. Kristi has been with Blair, Westfall and Company for three years and is a current member of the American Institute of Certified Public Accountants (CPA), the Iowa Society of CPAs, and the Illinois Society of CPAs. She is also a member of the Zelta Phi Delta Sorority Incorporated. Kristi resides in Davenport, IA with her two children, Jeremiah & Naomi. In her spare time Kristi enjoys gardening, playing board games, reading, and painting.

Jeanne Cook
Jeanne is an original team member of Blair, Westfall and Company. Jeanne has spent 39 years as a Public Accountant working in numerous states including Arizona, Tennessee, Ohio, and Iowa. Jeanne worked with Glenn Blair for 14 years before he established Blair, Westfall and Company in 2009. Jeanne currently serves as the Home Owners Association President & Treasurer of her neighborhood, has served two terms as the President of the Bettendorf Athletics Booster Club and is a past recipient of the Iowa Governor’s Volunteer Award. 

Colton Hansen
Colton is a graduate of St. Ambrose University where he earned degrees in Accounting, Finance, and Marketing. While in college, Colton spent a year and a half interning for a local accounting firm until graduating in 2018 and joining Blair, Westfall and Company.

Tiffany Newswander
Tiffany received her education from Monmouth College graduating with a BA in Accounting with minors in Business Administration and Computer Science. She has worked in the industry for the last 20 years in both public and private sectors. She also obtained her CIAO (Certified Illinois Assessing Official) designation in 2005 and worked as an assessor as well as an accountant for 12 of those years. Tiffany joined Blair, Westfall and Company in March 2018 and manages the Milan office. She is president of her local school district’s music booster organization. Tiffany is also currently the treasurer for Northwest TEC (Teens Encounter Christ) and serves on their Spiritual Core Council. Tiffany and her husband, Ryan, live in Aledo, IL and have three children; Taylor, Brooklyn, and Rylan.


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