In a 1946 essay, George Orwell laid out his six rules for writing. The first five—including such gems as “never use . . . a jargon word if you can think of an everyday English equivalent”—reflect the famed author’s expert approach to his craft. But it is the final command that stands out. “Break any of these rules,” Orwell instructs, “sooner than say anything outright barbarous.”

Over the years, I’ve disclaimed macroeconomic analysis in this space too many times to count. And as a value investor, I look forward to doing so many times more in the years to come. Even so, at this particular moment in time, any attempt at ignoring the bigger forces currently at play in the market would be, if not “barbarous,” perhaps a bit bullheaded. So, with the election looming, the pandemic ongoing, and major news stories breaking at what may feel like an unsustainably fast clip, I hope you’ll forgive my offering three “big picture” thoughts.

First, as to the election, a proposition you won’t see aired in too many headlines: that no matter how feverish the partisanship gets, our country, by design, will be just fine. Since its framing, this republic has operated under the principle that no single government actor can truly rock the boat on his or her own. Though this concept is a mainstay in the context of schoolchildren learning about “checks and balances,” one often finds it conspicuously absent in election-season cocktail conversation. In that setting, America’s fortunes always seem to turn exclusively on the next president. With all due apologies to the next alarmist you encounter, this is simply not the case. As James Madison observed in 1788, our constitutional framework consists of “several constituent parts,” which, “by their mutual relations,” are “the means of keeping each other in their proper places.” So too, I’d humbly posit, in 2020—no matter what happens come November.

Second, concerning Covid-19, a note of optimism: by any candid assessment, the medical cavalry is on the way. In the last seven months, one might be forgiven for having acquired, as a general worldview, an attitude of waiting for the other metaphorical shoe to drop. Yet, while there will doubtlessly be more difficult days ahead, all signs point to the bulk of the hardship being behind us. As this note goes to press, the deadliness of the virus drops by the day; the FDA expects to approve at least two vaccines by January 2021; and expert opinion—solicited from both sides of the aisle—indicates that America may be out of the woods entirely by next Memorial Day. Taken together, these factors may not quite call for breaking out the rose-colored glasses, but they do, at the very least, counsel in favor of a cautious optimism.

Finally, there is the business at hand: the trust you have placed in us. While we here at Tufton Capital do not generally invest in “macro” theses, we are heartened by the fact that our approach to safeguarding your capital is particularly suited to these turbulent times. At first blush, there is no denying that all boats rose in the third quarter of this year, with the S&P, Dow Jones and Nasdaq indices rising by approximately 9%, 7% and 11%, respectively. In the search for a signal amongst the noise, however, September’s head-spinning volatility delivers an unmistakable message. While “hot” stocks are apt to fall as fast as they rise, value investments, by their nature, chart a steadier course. Since 1995, this simple truth has kept our clients in good stead across highs, lows and political rollercoasters alike. With so much present uncertainty, we hope you take comfort in the fact that it will do the same for you.

Chad Meyer, CFA

President