“In the midst of chaos, there is also opportunity” Sun Tzu, The Art of War

Good morning,

My daughter Presley-Mae asked me this weekend, “Dad, why is Russia attacking the people in Ukraine”……it was honestly hard for me to come up with an answer that would make any sense to an eight year old. Geopolitical tensions between the Ukraine and Russia have been bubbling to the surface for some time, but they took a meaningful turn over the past few days with Russia embarking on an invasion of its neighbor that is broader in scope than expected. First and foremost, our thoughts and prayers are with any of our clients, family, friends, and colleagues who may be impacted one way or another by developments in the region. While we have a responsibility to focus on the investment implications of such a crisis, it’s important to recognize the human toll these conflicts can have.

As of this morning, the Russian invasion of Ukraine now in its fourth day amid reports Moscow has become frustrated its assault is moving too slowly in the face of fierce resistance. The situation remains fluid as more Russian forces move in on Kyiv and reports Belarus preparing to join invasion of Ukraine….the Ukrainian President Zelensky has agreed to talks with Russia at Belarus border but was skeptical they would produce results…we’ll be watching as this plays out.

Global financial markets have responded in a somewhat orderly fashion in recent days. Although volatility has increased, global equities are looking out beyond the current situation and pricing in future impact. Government bonds have modestly risen, while the U.S. dollar and commodities like gold have benefitted from a general flight to safety. We are likely to remain in a period of elevated volatility and markets may remain vulnerable in the near-term as developments in Europe unfold. But, history has taught us that military conflicts tend to have a market impact that is limited in magnitude and time. As a result, we are not making dramatic shifts to portfolio allocations in a meaningful way. However, we remain nimble, flexible, and looking to make allocations as we see opportunity.

Over the weekend I dug out the book "The Art of War", a book that I havent read since my days at Bishop’s University. The book remains on of the world's most famous military texts, 2,500 years after it was published by advisor Sun Tzu. Being celebrated by today's business gurus, coaches and mindfulness exprerts as guidance for dealing with our own exterrnal and internal conflict, it’s a text that is full of advice that I thought it fitting to share a few lessons it provides……for you interperate and reflect on personally, as it relates to your own plans and strategies for your future self.

5 Lessons from The Art of War

1. Choose your battles - "He will win who knows when to fight and when not to fight.”
2. Work to understand yourself deeply & practice self refletion - “It is said that if you know your enemies and know yourself, you will not be imperiled in a hundred battles; if you do not know your enemies abut do know yourself, you will win one and lose one; if you do not know your enemies nor yourself, you will be imperiled in every single battle."
3. Change respresents opportunity - "In the midst of chaos, there is opportunity."
4. Personal improvement creates positive momentum - "Opportunities multiply as they are seized."
5. Being mindful and intensional in our planning will ensure we achive our goals - “Ponder and deliberate before you make a move.”

I could have written a lengthy note on these lessons, but I’d encourage you to interperate Tzu’s text and lessons yourself, to see how his words resonate with your own unique journey. Overall, what The Art of War tells us is that we need to be aware of ourselves and others and by maintaining an open mind to the things that are happening around us, we can make an informed decisions that will not only help us in our personal lives, but those in our professional lives and our families as well.

Be well & enjoy the moments

Derek