Raymond James

Lots has been written about the strength of the US economy not translating into improvement in the different measures of consumer confidence and consumer sentiment over the last several years.

Reducing or eliminating debt might feel like the ultimate financial milestone, but paying off debt early – or avoiding it entirely – can limit future opportunities for building or preserving wealth. During periods of volatility, it may be tempting to get rid of debt for short-term relief, but this could compromise your long-term plan. Staying the course may be crucial to your goals – no matter the market.

July was an eventful month for both domestic and international markets, with US-Iran tensions flaring up, increasing energy prices and changing investor expectations for the Federal Reserve (Fed) cutting rates.

This summer has offered little opportunity for a lull. Investors have contended with Federal Reserve (Fed) policy uncertainty, renewed tariff-driven inflation concerns, escalating tensions in the Middle East, questions about the durability of AI-related investment spending and a packed earnings calendar.

The US economy grew less than expected during the second quarter of the year, up 1.5% quarter over quarter, dragged down by strong growth in imports. However, final sales to private domestic purchasers increased by 3.9%, underscoring the strength in domestic demand, which continues to rely too heavily in AI investment spending and strong spending from high-income consumers, or what has been called the K economy.

Fixed income can serve several important purposes within an investment portfolio, including income generation, capital preservation, diversification, and supporting future cash flow needs. Unlike growth assets, an individual bond generally provides a defined schedule of interest payments and a stated maturity date.

With the US-Iran conflict nearing the five-month mark, equity markets have mostly shrugged off the latest escalation. On one hand, that’s understandable – a healthy economy and record corporate profits continue to support the market’s fundamentals. But a note of caution is warranted.

The motivation for today's report comes from the growing number of articles warning about the possibility of an AI bubble. The truth is that nobody knows whether a bubble exists today in artificial intelligence or whether one may emerge in the future.

Equity markets have shown resilience amid persistent headwinds, supported by index evolution and earnings strength

Investors continue to benefit from two powerful tailwinds: strong stock-market performance and bond yields that remain attractive compared with much of the post-financial-crisis period. Higher yields have improved the income generated by fixed income portfolios and given investors more flexibility to balance income, liquidity, and interest rate risk.

For a Federal Reserve (Fed) chairman committed to reducing noise coming from the institution and/or to changing how the Fed communicates, his first attempt to do so was not very promising. Just after Chair Warsh’s first press conference, we argued that inflation was not a choice, as he suggested during the press conference.

Financial markets were eventful this week, with key inflation reports, Federal Reserve (Fed) Chair Warsh’s first semiannual testimony to Congress, renewed Middle East tensions, and the start of earnings season all helping shape the narrative.

Regardless of how inflation is measured or debated, households continue to feel the cumulative effect of higher prices. The cost of goods and services have risen at a high pace over the past several years, and wage growth has not always kept pace evenly across households.

Every major geopolitical crisis has two types of effects: those that occur during the crisis itself and those that remain on a long-term basis, perhaps even permanently. The US-Iran conflict is no exception.

While tariff uncertainty hasn’t completely disappeared, it has diminished, and firms are feeling less uncertain about the future.

Despite geopolitical headwinds, the broader macro backdrop remained constructive in the first half of the year. Economic growth proved resilient, consumers kept spending and the S&P 500 gained 10%. That favorable mix drove strong earnings growth, with S&P 500 earnings rising 27% year over year in 1Q26, led by the tech sector.

As we move through 2026, the political and geopolitical landscapes remain key drivers of policy uncertainty. For the midterm elections, our base case is a Democratic House and Republican Senate, a historically favorable outcome for equities.

The capital markets have become an increasingly complex space for investors, complexities that are heightened by the sheer number of ways one can invest.

The first half of 2026 has provided a considerable amount of news for investors to digest. Notably, equity markets were higher by nearly 10%, oil prices spiked over 50% before retreating nearly back to where they started, there is a new Chair of the Federal Reserve in Kevin Warsh, and AI infrastructure spending surged.

Today’s market backdrop reflects a tension between expectations and reality. Despite higher oil prices and plenty of geopolitical noise, the US economy remains resilient and durable, supported by steady consumer spending, a labor market finding its footing, ongoing fiscal support and a surge in AI and infrastructure investment.

June saw strong market fundamentals once again in conflict with macroeconomic uncertainties, creating a choppy market. While a durable peace plan with Iran is seemingly underway, investors have regarded the negotiations with caution, pricing in potential setbacks.

It’s hard to believe we’re nearing the halfway point of 2026 – and what an eventful start it’s been. Markets have pushed through a geopolitically driven energy shock, rising inflation pressures and accelerating disruption from the artificial intelligence boom.

From our experience participating in Fed meetings, we know that the dot plot has never been universally embraced within the institution. The concern was not that it lacked informational value, but rather that markets interpreted it as a forecast, which was never its intended purpose. Forward guidance is meant to shape expectations and influence behavior, not to serve as a firm prediction of future policy decisions.

The rising debt burden of the U.S. government is becoming an increasingly serious economic concern. While it may not be an immediate crisis, it has the characteristics of a slow-moving domestic pandemic.

The US-Iran conflict – and its impact on oil prices – has dominated headlines over the past three months. Higher oil prices have pushed inflation to a three‑year high, reshaping the Federal Reserve’s rate outlook.

There is a great deal to unpack from this week’s press conference by the new chairman of the Federal Reserve, Kevin Warsh. Most striking is his markedly different approach to Fed communications. This was evident not only in the statement accompanying the federal funds rate decision, but also in the abandonment of forward guidance and his reluctance to provide insight into the committee’s internal deliberations.

Green life, sustainable mutual funds, buying local, the “buy nothing” movement, plastic-free living, eco-fashion, electric vehicles. You’ve seen all the headlines about reducing your impact on the planet, but you may be wondering how you can best implement a greener workplace in a way that considers the needs of your business, employees and clients or customers.

The Federal Open Market Committee (FOMC) meets this week in what will be Kevin Warsh’s first meeting as Chair of the Federal Reserve. President Trump has been vocal about wanting to see lower yields and general consensus is that Warsh was his pick due to Warsh’s general lean towards lower rates.

New Federal Reserve Chairman Kevin Warsh will preside over his first Federal Open Market Committee (FOMC) meeting on June 16-17, stepping in at a complex moment with inflation at a three-year high as oil prices remain elevated, labor market risks easing with job growth averaging ~140,000 year to date versus only 10,000 last year, and hawkish voices on the Fed gaining traction.

This week’s inflation data highlights a growing disconnect between how markets interpret inflation and how consumers experience it. The May Consumer Price Index (CPI) report delivered a nuanced message: While headline inflation accelerated, core inflation remained relatively contained, an outcome that provides some comfort to policymakers.

While owning a significant amount of a successful stock can be incredibly lucrative – especially in a company on the rise – the more you own of a single equity, the more closely your personal financial fate is tied to its performance.

Investors have enjoyed a favorable run. If the year ended today, it would mark the seventh time in the last nine years that stock portfolios generated double-digit returns. Housing prices remain near historic highs, while bond investors have benefited from elevated yields over the past three years.

Labor market fundamentals have improved meaningfully from last year’s near standstill while inflation has moved higher, driven in part by the Iran conflict and the resulting increase in petroleum and gasoline prices. As a result, Federal Reserve (Fed) officials are likely becoming more concerned about the risk of broader inflation pressures, a theme highlighted in this week’s ISM Manufacturing and Services PMI releases.

With tech stocks pushing to new highs on enthusiasm around transformational technologies, the real question isn’t just momentum. It’s whether markets are becoming frothy, even bubble‑like, reminiscent of the dot‑com era. We don’t think so.

As a symbol of economic vibrancy and opportunity, it’s hard to beat the public market. Its storied venues, where everything from butter to trillion-dollar tech companies are bought and sold, are a foundation of the modern world.

Would I be better off waiting for the Fed to make its move on rates before investing?” “Should I wait to increase duration because a blocked Strait of Hormuz could push oil prices higher and push rates even higher?” “Should I invest in bonds gradually to reduce the risk of missing the rate peak?

Geopolitical risks are still lingering in the background, but the story lately has been all about earnings. A strong 1Q26 season, paired with a steady drumbeat of upbeat management commentary, has helped push the S&P 500 to 21 record highs this year.

Ahead of next week’s May employment report, the summer jobs market is coming into focus as teenagers and students finish the school year. According to Challenger, Gray & Christmas, teen hiring from May through July is expected to total just 790,000 jobs this summer, down slightly from 801,000 last summer.

Despite headwinds from rising oil prices, fundamentals have remained strong. The S&P 500 has notched 18 record highs year to date and, more importantly, surpassed our prior target of 7,250. Following a standout 1Q earnings season, we are raising our 2026 earnings per share (EPS) estimate to $326 from $300.

After a slowdown earlier in the year, stronger April and May data support the view that weakness in January and February, followed by a rebound in March, was largely weather-related rather than the start of a broader deterioration in housing demand.

On Friday, May 15, the 10-year Treasury yield closed at 4.59%, its highest level since February 2025. The 30-year Treasury yield closed near 5.12%, a level last seen in 2007. Those are significant moves because they reflect a repricing of the market’s inflation, growth, and Federal Reserve expectations.

Leadership transitions at the Federal Reserve (Fed) are rare. Only seven individuals have served as Fed chair since the 1970s, underscoring how infrequent turnover is at the Fed’s top job. That rarity is why investors pay close attention when a new chair is appointed, especially when the incoming leader brings a different perspective. Kevin Warsh has been a vocal critic of Fed policy and communication in recent years.

Yes, this time is different, but not because inflation itself is unprecedented. What has fundamentally changed is the macroeconomic starting point. Unlike the post-Global Financial Crisis period, when persistent disinflation and repeated downside surprises dominated policy decisions, the economy today is operating in a world where structural disinflation is no longer the default backdrop.

Psychology plays a larger role in our investing lives than many of us care to admit. Often, when investing, we would be better off being a bit more robotic and a bit less human. The reason behind this is often our feelings influence our decisions in ways that are not always to our advantage.

Firms pulled back sharply on hiring last year as policy uncertainty and higher input costs – driven largely by tariffs – forced a reassessment of risk. Nonfarm payroll growth averaged just 9,700 per month in 2025, down dramatically from 121,600 in 2024. That slowdown reflected a familiar corporate response: When uncertainty rises, labor – the largest and most flexible cost – becomes the primary adjustment mechanism. Rather than expand headcount, firms chose to wait.

With 82% of market cap having reported, the S&P 500 is on track for 27% year-over-year earnings per share (EPS) growth, the strongest since 4Q21. More than 84% have beaten earnings estimates − the most since 1Q21 − while earnings revisions are up 12%, the fastest pace in four years.

The generational divide is a part of the human condition – and the investor condition. It’s not just that one group has more experience than the other, or that one is more eager to make its own way, but that both groups can learn totally different lessons from the same event.

Utilizing a portfolio of individual bonds can provide benefits that are difficult to reproduce via other fixed income investment vehicles. The portfolio can be completely customized to the specifications of an investor, providing a solution that aligns long-term financial goals with personal preferences. Product choice, issuer selection, cash flow, maturity, tax considerations, and credit quality, can all be customized.

While oil prices are likely to remain elevated in the near term, we do not view the current disruption as a lasting supply shock. A diplomatic resolution, or even progress toward one, should help bring prices lower by year-end. Although higher oil prices are a headwind, we believe both the economy and equity markets can absorb the impact with limited damage, as underlying fundamentals remain strong.

Despite repeated wars, equity markets have delivered strong long-term returns, and in some stretches, market performance appears to have coincided with wartime episodes rather neatly. Viewed through the lens of financial markets, the implication seems almost intuitive: wars have not been bad for investors and may even have been supportive.

April showed us just how sensitive markets can be to a small number of powerful forces: energy prices, inflation and geopolitical risk. The conflict in the Middle East dominated headlines, with a ceasefire helping to steady markets even as energy prices remained elevated.

On Friday, the Department of Justice announced it was dropping its investigation of the current Federal Reserve Chair Jerome Powell. Senator Thom Tillis was effectively blocking the nomination process from moving forward while the Department of Justice investigation of Powell was ongoing.

Congressional confirmation hearings tend to generate far more noise than signal, and this one was no exception. Between politicians posturing for the cameras in hopes of becoming their party’s next rising star, and nominees exercising extreme caution to avoid missteps under oath, these hearings rarely produce actionable insights.

The index is on the verge of doubling for the first time in this bull market – currently up ~99% – a move that would take just under 3.5 years, slightly faster than the historical average of 3.9 years. While all sectors are in positive territory over this period, leadership has been narrow with only three – technology, communication services and industrials – posting gains above 100%.

New Federal Reserve (Fed) chairs don’t come along often. Since 1980, only five individuals have led the Fed: Jerome Powell is currently in his second term, Janet Yellen served one term and Alan Greenspan famously held the role for more than 18 years.

The U.S. market story this year has been a tug-of-war between sticky inflation, slower growth, and resilient risk appetite. For fixed-income investors, that mix has produced more narrative movement than the 10-year Treasury itself.

After a 9.1% drawdown, the S&P 500 surged 11% over the last 12 trading days to a new record high, breaking above the 7,000 level for the first time.

Headline economic indicators remain resilient as gross domestic product (GDP) continues to expand, the unemployment rate remains low and wage growth has held up better than expected. However, these figures reflect averages, not the lived experience of households.

Yield curves exist for many products and can be interrelated, yet they also carry distinctive characteristics. Normally, long-term rates are higher than short-term rates because investors demand a higher return for lending money over longer periods. This arrangement would create an upward-sloping curve much like the Treasury curves displayed to the right.

The question that is increasingly on everyone’s mind is simple: Is this time different? The answer will hinge squarely on what happens to core inflation, specifically the core Consumer Price Index and the core PCE price index.

Over the past year, markets have been shaped by rapid advances in AI, elevated geopolitical tensions – especially involving Iran – and persistent uncertainty around global trade. In environments like this, successful investing rarely comes from chasing headlines or reacting emotionally. It’s about discipline, staying anchored to fundamentals and executing a clear long‑term game plan.

The famed economist John Maynard Keynes said almost a century ago that “markets can remain irrational longer than you can remain solvent.” He was referring to the unpredictable nature of investor sentiment: an amorphous, hard-to-define concept that nonetheless plays a major role across various asset classes.

Geopolitical tensions and disruptions to global energy supply often lead to higher gas prices at the pump. Amid the current conflict in Iran, oil prices have surged to above $100 per barrel for the first time since 2022.

The US-Iran conflict has altered Iran’s regional influence and, more broadly, has many other consequences. It pressures government relations as well as global and financial market trading.

Total return is the entire amount of income passed to an investor holding a particular security. It annualizes any price change plus any dividends or interest earned over time.

All eyes were turned toward the Middle East throughout the month of March, with the US and Israel’s ongoing conflict with Iran causing energy prices to surge. The closure of the Strait of Hormuz, alongside damage to energy infrastructure across the gulf region, caused crude to rise above $100 a barrel for the first time since 2022.

Recent weeks have been a whirlwind of headlines centered on the Middle East conflict and rising oil and gas prices, particularly as the conflict enters its fourth full week.

Next week’s releases should help clarify whether recent volatility remains contained or begins to translate into weaker fundamentals.

Rapid advances in artificial intelligence, persistent geopolitical tensions – particularly the conflict in Iran – and ongoing trade uncertainty have kept headlines loud and emotions elevated, ultimately demanding investors remain adaptive and disciplined. In this kind of environment, the biggest mistakes come from reacting to noise rather than fundamentals.

Your financial requirements are multifaceted, necessitating strategies tailored to your specific needs. Tailored lending can be a valuable addition to a high-net-worth individual’s financial plan, helping you optimize cash flow, maximize tax efficiency and realize important estate planning goals.

Although the US now produces more oil than it consumes, it still exports lighter crude and imports heavier crude that US refineries need. As a result, global supply disruptions continue to play an outsized role in determining what US consumers pay at the pump. In short, during geopolitical crises, international oil markets matter more for gasoline prices than domestic production alone.

The key swing factor remains oil prices. If the conflict ends within this window, we still expect only limited impacts on our economic and asset‑class outlooks.

When you start investing, your advisor builds a portfolio aligned with your personal investment objectives. Your target allocation takes into consideration your goals, risk tolerance and time horizon, among other things. Unless something in your life changes, your portfolio should continue to align with your objectives.

In this commentary, I’m not going to try to predict any outcomes or long-term effects but rather want to cover how markets have reacted so far and highlight some opportunities that have been created.

The Fed’s new economic projections are fraught with even more uncertainty. The Middle East conflict is unlikely to derail growth in a meaningful way.

Although the administration has expressed support for a lower federal funds rate, several policy developments since taking office continue to complicate that objective. In particular, recent tariff actions – some of which were legally challenged and later invalidated by the Supreme Court – have contributed to ongoing uncertainty around trade policy.

North is south, south is west, west is east, east is north, up is down, and down is steady. This week’s employment reports have something for everyone, which is precisely why we should interpret them cautiously.

Doug Drabik discusses fixed income market conditions and offers insight for bond investors.

While senior military officials on both sides have signaled that the campaign may intensify in the near term, keeping headline risks elevated, we outline below why we believe the conflict is likely to be short-lived, and what that could mean for the economy, the Federal Reserve and financial markets in the weeks ahead.

Investing in financial markets is not for the timid. In a very recent Bond Market Commentary, the Head of Fixed Income Solutions, Nick Goetze, discussed “Preparing for the Storm.”

AI-related disruption has moved to the forefront of market conversations in recent weeks, driving shifts beneath the surface. While the S&P 500 remains near all-time highs, leadership has rotated across sectors as concerns about AI’s impact on future demand and long-term valuations have spread.

Markets could face near-term volatility in the wake of the Supreme Court’s decision to strike down tariffs levied under the Emergency Economic Powers Act (IEEPA). The ruling creates a complex landscape as markets adapt to multiple unresolved issues, including raised global tariffs, investigations and potential refunds.

Raymond James Chief Economist Eugenio J. Alemán discusses current economic conditions

It’s been a busy start to the midterm election year in Washington, marked by a second government shutdown, rising geopolitical tensions - including Iran and Venezuela – and continued uncertainty around tariffs.

Investors have long known balance is a key aspect of portfolio design. It presents a chance to achieve long-term growth and protect hard-earned assets at the same time.

Raymond James Chief Economist Eugenio J. Alemán discusses current economic conditions.

Markets move through phases of resilience, shifting leadership and renewed opportunity. We’ve seen this play out in recent months as performance has broadened beyond mega‑cap tech into areas that had long been overlooked.

The Dow Jones Industrial Average, better known as “the Dow,” closed above 50,000 points for the first time. It’s a historic milestone that comes less than two years after surpassing 40,000 in May 2024, but what does the milestone mean, and does it signal time for investors to reduce exposure?

There are reasons people dig storm shelters in Tornado Alley, build their houses on higher ground on the coast of Florida, and at a basic level why most of us buy insurance.

A couple of weeks ago, on Jan. 23, 2026, we dedicated part of the weekly commentaries to the mismatch between the economy and how American consumers feel about it. We said that measures of consumer confidence and consumer sentiment were not in sync with the strength of economic activity.

Recent tech headlines have stirred up fresh disruption fears, weighing on software stocks and the sector more broadly. Below, we break down key takeaways from 4Q25 earnings and share our latest views on tech:

When it comes to investing, you don’t have to do it alone. Whether you’re planning for the future with your spouse, growing wealth with a family member, or expanding your goals alongside a business partner, a joint brokerage account allows you to share the opportunities and responsibilities that come with growing your money together.

It may be fitting that Groundhog Day occured on a Monday this year. Punxsutawney Phil has been officially prognosticating the weather since 1887.

With rising geopolitical tensions, sharp market swings and Congress at odds over Department of Homeland Security funding – likely to cause a brief government shutdown – there’s no shortage of factors influencing sentiment. Here, we address some of the most prominent headlines shaping sentiment and offer our perspective.

This week’s press conference by Federal Reserve Chair Jerome Powell was one of the most consequential of his tenure at the helm of the Federal Reserve (Fed).

With rising geopolitical tensions, sharp market swings and Congress at odds over Department of Homeland Security funding – likely to cause a brief government shutdown – there’s no shortage of factors influencing sentiment. Here, we address some of the most prominent headlines shaping sentiment and offer our perspective.

Doug Drabik discusses fixed income market conditions and offers insight for bond investors.

Raymond James Chief Economist Eugenio J. Alemán discusses current economic conditions.

Markets, interestingly enough, felt their own version of a “deep freeze” this week. Geopolitical flare-ups, fresh tariff threats and a mini-meltdown in Japan’s bond market briefly rattled investors and pushed volatility sharply higher.

Each spring, investors in individual publicly traded companies get a chance to voice their opinions as the companies whose stock they own prepare for their annual shareholders’ meetings.

Investors have reaped the benefits of good market conditions in many of the recent years. These periods are ideal for wealth accumulation.

2026 is coming out of the gate quickly. In just the first two weeks, we’ve seen a flurry of headlines – rapid-fire policy proposals, legal uncertainties, and fast-moving geopolitical developments – all with the potential to influence the economy and financial markets.

The biggest concern for the Federal Reserve (Fed) today is the weakness in employment over the last year, and especially during the second half of the year. This weakness was behind its decision to resume interest rate cuts in September of 2025.

Raymond James Chief Economist Eugenio J. Alemán evaluates economic conditions heading into 2026.

Drew O’Neil discusses fixed income market conditions and offers insight for bond investors.

As we step into the new year, many of us are setting personal and professional goals for what we hope to accomplish in the months ahead. The same holds true for financial markets, where Wall Street strategists have been busy refining their outlooks for where the S&P 500 might finish the year.

Our forecast for 2026 is for a strengthening US economy on the back of a strong fiscal spending profile due to the implementation of the One Big Beautiful Bill Act (OBBBA).

In 2025, the S&P 500 delivered double-digit returns for a third straight year. Heading into the fourth year of the bull market, Raymond James Chief Investment Officer Larry Adam identifies 10 themes to watch in 2026.

After three consecutive years of increasing stock prices, it can feel comfortable and certainly satisfying to ride the trend. Investors may want to capture the boon rather than be complacent with it. Long-term financial health can go hand-in-hand with the opportunities the markets have laid out.

For the third consecutive year – and sixth among the past seven – the S&P 500 tallied double-digit gains – a remarkable run. As the index climbed 16.39% for the year, it also recorded 38 new record highs.

This week’s release of the FOMC meeting minutes showed relatively strong diverging views on current monetary policy as well as on the path for policy this year.

Now, as we turn the page to 2026, new challenges await: geopolitical tensions, lofty valuations, and an evolving macro backdrop. That’s why we’re excited to unveil our Ten Themes for 2026, inspired by Mission: Impossible, celebrating the 30th anniversary of its first movie this year.

Now that the Bureau of Labor Statistics (BLS) released the delayed October and November nonfarm payroll numbers, do we know more about the US labor market than we knew before the release? Probably not.

Before we turn the page on 2025, let’s take a moment to reflect on the key trends that shaped the economy and financial markets this year. Despite heightened policy uncertainty and persistent geopolitical tensions, both proved remarkably resilient.

Doug Drabik discusses fixed income market conditions and offers insight for bond investors.

The Federal Reserve wrapped up its final meeting of 2025, delivering – as expected – its third consecutive rate cut. Policymakers lowered the fed funds rate to a target range of 3.5% to 3.75%, signaling continued support for the economy.

Chief Economist Eugenio J. Alemán discusses current economic conditions.

With the Fed's final 2025 meeting approaching, markets anticipate a third rate cut amid labor weakness, though the FOMC remains publicly divided on balancing a cooling job market against sticky inflation.

Recessions are less common today than they were before the 1980s. Some argue that the reason is that we have become better at conducting fiscal and monetary policy to reduce the ebbs and flows of economic cycles.

A mid-month bout of volatility focused primarily on the AI tech giants gave way to a broader rally in November’s final days amidst renewed expectations the US Federal Reserve (Fed) will cut interest rates in the coming weeks.

Rob Tayloe discusses fixed income market conditions and offers insight for bond investors.

Investors are needy. Insatiable, really. But it makes sense: If an investor buys a share of a company, they’re going to want some benefit from it.

Although the September employment report surprised to the upside, the overall stance of the US labor market remains weak, something that was underscored by the third consecutive increase in the rate of unemployment, from 4.1% in June to 4.4% in September.

With Thanksgiving around the corner, there’s so much to be thankful for in 2025, especially for investors. After a challenging start to the year, the economy and markets regained their footing quickly, with nearly all asset classes on track for solid gains heading into year-end. Looking ahead, there are reasons for optimism to continue into 2026 as well.

While headlines often speculate about an AI bubble, we believe the long-term outlook for technology remains strong. Periodic volatility is a normal part of any innovation cycle and unlikely to derail our constructive view on equities.

Drew O’Neil discusses fixed income market conditions and offers insight for bond investors.

We were in the camp that the Federal Reserve (Fed) should have reduced interest rates during the first half of the year, taking advantage of the underlying disinflationary path during that period.

Doug Drabik discusses fixed income market conditions and offers insight for bond investors.

It’s been one year since President Trump secured his second term, and we’re taking stock of how the economy and financial markets have performed during that time, highlighting both the wins and the challenges.

Although the stability of the consumer depends on its ability to generate labor income, i.e., wages and salaries, households’ financial conditions are very important in supporting the stability of consumption.

Together with the surge in investments brought about by the CHIPS and IRA acts, plus the recent surge in AI investment, US consumers continue to be the backbone of the US economy.

Even with the government shutdown casting a shadow over Washington D.C., equity markets have continued their upward march, fueled by a trifecta of positive surprises: cooler-than-expected inflation, another rate cut by the Federal Reserve (Fed) and easing trade tensions.

Markets were taken by surprise by Federal Reserve (Fed) Chair Powell’s strong suggestion that a rate cut in December is not a certainty, as they were sure they were going to get one at December’s Federal Open Market Committee (FOMC) meeting.

Doug Drabik discusses fixed income market conditions and offers insight for bond investors.

This convergence creates a thrilling, unpredictable day for sports enthusiasts packed with drama. Interestingly, the financial markets are gearing up for their own version of a 'Sports Equinox' week. Just as fans juggle overlapping games on October 27, investors will face a crowded calendar of potentially market-moving events that have our attention.

Chief Economist Eugenio J. Alemán discusses current economic conditions.

Every week, this platform is used to highlight current ideas, fixed-income concepts, economic occurrences, and/or clarify a strategic fixed-income feature. The cohesive topic threads are fixed-income issues relevant to current market conditions.

Last week’s scheduled release of the Consumer Price Index (CPI) for September was postponed due to the ongoing federal government shutdown, which has disrupted the operations of key agencies like the Bureau of Labor Statistics (BLS).

Doug Drabik discusses fixed income market conditions and offers insight for bond investors.

Tech and its derivatives have led returns thus far. After hefty multiple expansion, earnings will need to take the driver’s seat.

Doug Drabik discusses fixed income market conditions and offers insight for bond investors.

Despite inflation remaining a concern, the Federal Reserve (Fed) cut interest rates in response to weakening jobs numbers. This allowed small-cap equity performance to lead a month that was generally positive across sectors, cap sizes and asset classes.

Last week, my colleague wrote about Anchoring Bias, a psychological phenomenon that attaches a particular price or specific yield level to a bond.

Consumption spending surprised to the upside once again in August, something we had already seen from last week’s release of retail and food services sales during the same month.

Goodbye summer, hello fall! As the sun sets on another season, we’re swapping beach days and backyard barbeques for crisp mornings, vibrant foliage, football weekends, and everything pumpkin spice.

Drew O’Neil discusses fixed income market conditions and offers insight for bond investors.

The Fed operates under a dual mandate: to promote price stability and maximum employment. Lately, employment has taken center stage, prompting the Fed to resume its easing cycle with a 0.25% rate cut this week.

From the lack of conviction in the previous meetings to last week’s “risk management cut,” Federal Reserve (Fed) officials continue to walk a very fine line, hoping for the effects of tariffs to be transitory.

Labor concerns and persistent inflation have the Fed penciling in up to two additional cuts by the end of 2025.

Nick Goetze discusses fixed income market conditions and offers insight for bond investors.

With the Federal Open Market Committee (FOMC) meeting on the horizon, we’ve taken a closer look at recent economic developments to better understand the landscape Federal Reserve (Fed) officials will be navigating during the two-day meeting, which begins September 16.

A look inside why more Americans are turning to lifetime income.

The financial world is replete with terms and definitions, many of which overlap in concept or application. Perhaps I can simplify a familiar concept for most investors who strive to grow and preserve their wealth.

As summer fades and the first hints of fall appear, football fans have reason to celebrate – the new season officially kicked off last night. But while excitement builds on the field, the equity market may be losing steam.

Our biggest concern today is that if the labor market is as weak today as the numbers are showing, what will happen when all the federal government workers start dropping out of the employment numbers at the end of the fiscal year and during the next several quarters.

A market-wide boom of private equity investment is turning small, local residential service providers into big business. From the outside, it's been easy to miss.

Whether you’re building your portfolio, trying to diversify or considering new investments, understanding the difference between active and passive funds is extremely helpful. Both mutual funds and exchange-traded funds (ETFs) can be either active or passive.

Doug Drabik discusses fixed income market conditions and offers insight for bond investors.

Earnings results surpassed expectations for the third consecutive quarter, which drove the market's strong August performance.

Each bank sets its own Beige Book reporting priorities, though prices, jobs and real estate are common themes. The Kansas City Fed, for example, covers nine topics, including community conditions, community and regional banking and agriculture.

Nick Goetze discusses fixed income market conditions and offers insight for bond investors.

Don’t Worry, Be Happy! Heading into summer, markets faced a wave of uncertainty—from shifting tariffs and debt ceiling debates to questions around the fate of the ‘Big, Beautiful Bill.’

Chief Economist Eugenio J. Alemán discusses current economic conditions.

Winding Down The Summer! While summer ‘officially’ lasts until late September, Labor Day marks its ‘unofficial’ close – and it’s fast approaching. That makes now the perfect time to hit the beach, prep and get organized for the school year, or sneak in a last-minute getaway.

Chief Economist Eugenio J. Alemán discusses current economic conditions.

Borrowing can offer flexibility and align with long-term financial goals.

For many investors, land ownership is part of the American Dream. But what happens when the land you own sits idle?

Doug Drabik discusses fixed income market conditions and offers insight for bond investors.

Most economists, including us, were wrong about the ‘ensuing’ recession back in 2022 and 2023 as the US Federal Reserve (Fed) increased interest rates to fight higher inflation.

The Fed confronts a dilemma as hiring slows while inflation heats up.

What if you could capture the potential gains of the S&P 500, but limit your losses if the market goes down? Or earn above-market income given the right stock market conditions?

Last week brought a wave of headlines for investors to digest – on both the macro and micro fronts.

Chief Economist Eugenio J. Alemán discusses current economic conditions.

Signs of market fatigue and elevated expectations suggest that caution may be warranted.

Doug Drabik discusses fixed income market conditions and offers insight for bond investors.

With the August 1 trade deadline fast approaching, America’s trading partners are racing to finalize agreements in hopes of securing more favorable terms before the higher tariffs announced by President Trump take effect.

Senior Investment Strategist Tracey Manzi notes that while sentiment shifts can sway markets in the short-term, the US dollar's supremacy will likely remain intact.

The ability of the US economy to avoid a recession in 2022-2023 rested, in part, on the resilience of non-residential investment, which was propped up by a strong private investment push from companies taking advantage of provisions in both the CHIPS Act as well as the IRA.

Green life, sustainable mutual funds, buying local, the “buy nothing” movement, plastic-free living, eco-fashion, electric vehicles.

Doug Drabik discusses fixed income market conditions and offers insight for bond investors.

Chief Economist Eugenio J. Alemán discusses current economic conditions.

Will he or won’t he? That’s the question on investors’ minds as tensions rise between President Trump and Fed Chair Jerome Powell.

The sweeping 900-page tax and spending law signed on July 4 introduces a wide array of provisions that touch nearly every American in one way or another.

The capital markets have become an increasingly complex space for investors, complexities that are heightened by the sheer number of ways one can invest.

Drew O’Neil discusses fixed income market conditions and offers insight for bond investors.

This year, so far, the world has been riddled with geopolitical news, resonating in widespread unrest, yet seemingly yielding less impact on financial markets.

From investing to economics to politics, patterns emerge, lessons resurface and the past becomes a powerful guide for navigating today’s unpredictable landscape. Timing, perspective and adaptability can make all the difference in managing the complexities of modern markets.

Equity markets continued to march higher in June, seemingly unfazed by heightened Middle East tensions (which were short-lived) and the looming July 8 deadline for the administration’s pause on reciprocal tariffs.

It has been over six months since the FOMC has made a change to the Fed Funds rate. While the debate continues as to when the next cut will be, market consensus (per Bloomberg calculations) is currently for a 25 basis point cut in September.

Chief Economist Eugenio J. Alemán discusses current economic conditions.

Tensions in the Middle East and their effect on oil prices have dominated the recent news headlines—and for good reason. A rise in oil prices, especially if it lasts, can push up inflation and slow down economic growth.

It’s said nothing in life is certain save death and taxes. There is also certainly an increase in investors’ appetites for nontraditional instruments like hedge funds as their wealth grows.

Raymond James Ltd enters into agreement with FNZ to accelerate its digital transformation

Doug Drabik discusses fixed income market conditions and offers insight for bond investors.

We have seen a lack of conviction from the Federal Reserve (Fed) in previous opportunities. Last year, during the first quarter, Fed members were spooked, as inflation numbers moved higher, changing their view on the path forward regarding interest rates.

Drew O’Neil discusses fixed income market conditions and offers insight for bond investors.

If there is something the Federal Reserve (Fed) does not want to see today, as it approaches next week’s Federal Open Market Committee (FOMC) meeting, it is a shock to oil prices.

The calm before the storm is here – and the Fed knows it won’t last. This week’s Fed meeting is expected to be relatively straightforward.

Gold plays a distinct role in the global monetary system. Simply put, it’s perceived as money, and its function as a store of value makes it arguably the world’s most popular hedge against inflation.

Doug Drabik discusses fixed income market conditions and offers insight for bond investors.

The Federal Reserve (Fed) lost its chance to lower interest rates further during the first half of the year, when inflation came down to close to its 2.0% target with very limited risk that its decision would have triggered higher inflation.

On the trade front, investor uncertainty eased for a short time as President Donald Trump’s “Liberation Day” tariffs seemed to lose traction. Several key developments contributed, including a 90-day tariff pause with China, the signing of a US-UK trade agreement and progress on negotiations with other partners, including Europe.

Duration is an often confused term when it comes to financial fixed income investing. After all, in your everyday life, the definition of duration is the length of time it takes for something to occur.

Chief Economist Eugenio J. Alemán discusses current economic conditions.

Sell in May and Go Away? This old market saying tends to resurface around Memorial Day, suggesting investors should scale back their equity exposure ahead of what’s perceived as a seasonally weaker stretch for stocks.

While official estimates remain fluid and subject to change, our preliminary analysis at the time of this writing suggests that the House Reconciliation Proposal could significantly increase the national debt over the next decade.

Your financial requirements are multifaceted, necessitating strategies tailored to your specific needs. Tailored lending can be a valuable addition to a high-net-worth individual’s financial plan, helping you optimize cash flow, maximize tax efficiency and realize important estate planning goals.

Last week I talked about the upward sloping Treasury yield curve, a welcome change from the inverted yield curve that lingered for years. The upward sloping curve means that investors are rewarded more for taking on duration.

President Trump’s tariff maneuvers sent financial markets on a rollercoaster. The shock from his aggressive trade policies triggered a surge in volatility, briefly pushing the VIX above 50 – an extremely rare event.

Chief Economist Eugenio J. Alemán discusses current economic conditions.

Technology and trends have made individual investors an important part of the private market.

The 90-day reduction on tariffs between the US and China is a positive development, but some questions remain.

Keeping your financial plan aligned with your goals, risk tolerance and time horizon.

The more duration risk taken, the more reward or yield demanded by investors. This is why, historically, the yield curve provides incrementally more yield for longer-maturity bonds.

The roller coaster continues! A stronger than expected first quarter earnings season and encouraging signs on the trade front—highlighted by the US-UK trade deal—helped lift the S&P 500 from its April 8 near-bear market lows, reversing nearly all post-Liberation Day (April 2) losses.

Chief Economist Eugenio J. Alemán discusses current economic conditions.

One of the advantages of individual bonds is the ability to custom-select bonds that fit individual needs and/or goals

This week marks the first 100 days of President Trump’s second term in office—and what a rollercoaster it has been for the financial markets! While presidents often enjoy a ‘honeymoon period’ at the start of their tenure, Trump wasted no time ‘flooding the zone’ by pushing forward many of his key initiatives.

The GDP report for the first quarter of the year showed a very engaged business sector as it rushed to try to minimize, as much as possible, the future impact of higher tariffs.

Uncertainty reigned through April and likely will continue to do so, at least in the near term. Markets have reacted, both negatively and positively, to every headline coming out of Washington.

Doug Drabik discusses fixed income market conditions and offers insight for bond investors.

Think of the drafting process like investing—scouts meticulously rank players based on their strength, speed, flexibility, and mental acuity, much like we analyze the economy and financial markets to shape our outlook. The true value of these players might take years to unfold...

Chief Economist Eugenio J. Alemán discusses current economic conditions.

A tax-advantaged account offers certain tax benefits to encourage individuals to save or invest for specific purposes, such as retirement, education or healthcare. These accounts can help you lower your taxable income, defer taxes or avoid taxes altogether if used for qualified expenses.

Chief Investment Officer Larry Adam notes with volatility on the rise, maintaining a long-term view is key.

Many investors are wondering what to think of the volatility and uncertainty that has been pulsing through financial markets over the past few weeks.

Nick Goetze discusses fixed income market conditions and offers insight for bond investors.

Some of the reasons, but not the only ones, why our trade deficits are so large is because government expenditures are too high and/or we are not collecting enough taxes.

After sparking the steepest plunge in financial markets since the global pandemic five years ago, President Donald Trump’s administration made another dramatic pivot in its trade war strategy on April 9: It paused for 90 days the “reciprocal” tariffs that had been in effect for less than 24 hours.

President Donald Trump announced on April 9 that he was pausing the majority of the “reciprocal” tariffs scheduled to go into effect the same day.

The April 2 “reciprocal” tariff announcement has introduced a considerable amount of uncertainty and confusion about the path ahead and the end game for President Trump.

Tariff Turbulence. The President’s long-anticipated tariff announcement on April 2 has come and gone. Our hopes for some clarity, so the uncertainty weighing on confidence and the equity market could subside, were dashed after we heard the breadth and magnitude of the administration’s tariff plan.

The international trading system is not perfect, but as we have said so many times, freer trade is better than no trade and tariffs are, typically, the worst solution to trade issues between countries.

The incremental tariffs were bolder than market expectations and ushered in new uncertainty.

Turbulence is expected to continue until markets gain more clarity.

Doug Drabik discusses fixed income market conditions and offers insight for bond investors.

Economic activity hit a soft patch in the first quarter—whether it was fueled by the big pullback in confidence or one-off factors such as cold weather, a harsh flu season and an acceleration of imports ahead of pre- announced tariffs, our economist expects the slowdown will prove short-lived.

We were in the camp that the new administration was using the threat of tariffs as an instrument to negotiate deals with other countries, especially with our largest trading partners, Canada and Mexico.

Since May 2020, inflation (CPI) has gone from a low of 0.1% to a high of 9.1% and back to 2.8%. It is no wonder why any investor might at least pause in this period of uncertainty.

This week, and according to many, Federal Reserve (Fed) officials jumped onto the uncertainty bandwagon, along with consumers and businesses, waiting for more policy clarity from the Trump administration.

Happy National Countdown Day! Yes, you read that right—today is a day to celebrate the excitement and sometimes anxious anticipation that comes with planning for an upcoming event.

This week, and according to many, Federal Reserve (Fed) officials jumped onto the uncertainty bandwagon, along with consumers and businesses, waiting for more policy clarity from the Trump administration – and who could blame them with policies in daily flux?

Despite the increase in policy uncertainty, the Federal Reserve held its forecast steady at the March FOMC meeting with two rate cuts projected in 2025.

Several indicators used by fixed income investors to measure value have recently taken a positive turn, potentially flashing an entry-point opportunity for investors with money to put to work.

Keep calm and carry on. Recent weeks have seen financial markets rattled by swirling news headlines, tariff whiplash, and rising economic uncertainty.

Markets have been overwhelmed lately by the administration’s fast-paced and, many times, highly uncertain tariff measures.

Most of us associate 529 accounts with college savings. They’re flexible, allowing you to transfer assets to anyone, including yourself, for the express purpose of furthering the education of your beneficiary. But did you know that a 529 can be a powerful estate planning tool?

Volatility across financial markets has become a persistent theme in 2025. The recent volatility has stemmed from a range of factors, including:

At the start of the year, our Investment Strategy Committee outlook was positive for both the economy and the equity market, supported by strong consumer, labor market, and corporate fundamentals.

On March 4, 2025, the Trump administration imposed tariffs of 25% on Canada and Mexico and increased tariffs on Chinese imports to 20% from the previous 10% imposed earlier in the year.

We highlight some underreported positive developments that could keep economic growth on track and support higher equity prices in the months ahead.

As daily headlines drive volatility, the market has avoided overreacting thus far.

We detail some key factors driving the recent market volatility and provide our perspective on how we believe these events may unfold and impact the economy and financial markets.

We understand that in the business world the word ‘monetization’ of a service a company provides has become one of the most important words as, if successful, this monetization increases the valuation of that company’s stock price.

The overall size of the municipal bond market is over $4 trillion. While this a very large market, an investor’s personal situation combined with the nuances of the municipal bond market can sometimes make it feel much smaller.

Are European equities poised for a sustained recovery relative to U.S. equities? We outline five reasons why, as long-term investors, we continue to favor U.S. equities over European equities.

Back in May of 2024, we wrote a weekly commentary called: “We Can’t Import Cheap Homes; But We Could Import Cheap EV Cars.” In that weekly we argued that since the U.S. auto industry, does not want to build small cars because it is not competitive, then we should open the lower-end EV automobile industry to imports from China.

“Know what you own” is one of the many phrases we use to help describe and define fixed income, the components of bonds, and the characteristics that affect an investor.

financial markets are becoming uneasy as President Trump follows through on his campaign promises to impose or threaten new tariffs to improve trade imbalances or achieve some of his policy priorities

Tariff concerns are not only affecting inflation expectations but also Americans’ consumption patterns.

Cash flow and income sometimes get commingled, potentially creating confusion. Cash flow and yield typically represent two different components that can be used to accomplish different objectives.

While the expectation is Congress will raise the debt ceiling, the process is likely to be volatile.

We provide an update on the 4Q24 earnings season and explain why our positive outlook on tech- related companies remains unchanged.

Tariffs seem to have become a staple of Americans’ dictionaries lately as the new administration uses this policy instrument to achieve objectives that are not directly tied to the reasons tariffs have been used in the past.

Raymond James CIO Larry Adam looks at how the proposed tariffs may impact the economy and financial markets.

The equity market appears to be showing signs of broadening beyond technology.

After this week’s FOMC decision to hold the fed funds rate unchanged, markets and analysts concluded that Federal Reserve members had changed their views on inflation.

When constructing a portfolio, investors who are seeking income have a range of options to choose from.

The global economy will grow at a pace close to that achieved in 2024, notes European Strategist Professor Jeremy Batstone-Carr.

Doug Drabik discusses fixed income market conditions and offers insight for bond investors.

Next week we will have the first Federal Open Market Committee (FOMC) meeting decision on interest rates of the year, where Federal Reserve (Fed) officials are expected to leave the federal funds rate unchanged.

Senior Investment Strategist Tracey Manzi notes that the Federal Reserve's ongoing easing cycle should benefit short to intermediate maturities.

It is sometimes perceived that the Fed’s action changes all interest rates across the yield curve, but that needs to be put in perspective.

We understand that the monetary policy playbook since the Bernanke Fed and the Great Financial Crisis has changed considerably.

As we close the chapter on Biden’s presidency, we take a moment to reflect on his legacy.

Doug Drabik discusses fixed income market conditions and offers insight for bond investors.

US equities had a stellar 2024, with the S&P 500 up 25%, but the year ended on a softer note. The sharp rise in bond yields has caught the market's eye

Managing Director, Washington Policy Analyst Ed Mills looks at how several of the top market-relevant Washington DC issues could play out in 2025.

The US labor market has remained relatively strong, but the trend over the last year or so has been one of normalization back to the pre-pandemic levels.

Chief Economist Eugenio Alemán and Economist Giampiero Fuentes break down the factors likely to impact economic growth, inflation and interest rates.

Although underlying fundamentals and company financial statements can be difficult to analyze, the general public can easily discern price movements and understand the primary objective—buy low and sell high.

As we turn the page on 2024 and look ahead into 2025, the key question on investors' minds is: can 2024’s positive momentum in the economy and financial markets continue into 2025?

The most important issue regarding what lies ahead from an economic perspective is that the economy’s fundamentals remain solid with very few misalignments that could derail it, at least for now.

The year ahead may present challenges as markets and the economy look to maintain momentum.

December's market activity highlights the need for caution in the near term.

One of the benefits of purchasing property as an investment is the tax benefits that can come with it – both while you own it and after you sell. Applying tax-efficient strategies will help you make the most out of your investment property.

Annuities can provide a guaranteed lifetime income stream in retirement, no matter how long you live. They thrive under high interest rate environments and are currently offering the highest payouts seen in years.

Happy Holidays! As the page for the new calendar year will soon turn, three cheers for a happy, healthy, and prosperous new year! With 2024 rapidly drawing to a close, we reflect on the year and all that’s transpired—our readers are wonderful, the economy remains in good shape, and market returns have been stellar for those who participate.

Since we are not going to publish Weekly Economics on December 27, 2024, we will take this opportunity to say farewell to 2024 and to all our readers, we want to wish you a very happy holiday season and a very prosperous New Year 2025!

Start the new year right by reviewing and revamping your financial plan.

With persistent inflation and a resilient economy, the Fed's updated projections show two rate cuts next year.

As we approach the start of a new year, it is a good time to take a fresh look at your portfolio to ensure that it still aligns with your long-term goals.

As we approach next week’s Federal Reserve FOMC meeting ... it would be interesting to ask ourselves what we would do if we were members of the committee.

Help overcome market timing and loss aversion with dollar-cost averaging.

The markets sure had a lot to process this year – from surprisingly resilient economic data, to the Fed kicking off its easing cycle to an unprecedented presidential election season.

As the office buildings market faces headwinds, investors look to alternative sectors.

While politics garner headlines, fundamentals drive the market over the long term.

The 2024 wild ride has proven to be a continuation of last year’s.

As we look through our financial lens and reflect upon everything that has transpired in 2024, we have compiled a list of the top ten economic and market-oriented things that we are most grateful for this year.

There has been a lot of talk about (in)efficiencies in government spending, both before and since the election. Much of the conversation has been driven by Elon Musk, who will co-head the Department of Government Efficiency (DOGE, not an actual government agency). Musk has boasted he could find $2 trillion to cut from the federal budget.

The Treasury yield curve has shifted appreciably all year long. In particular, the last few months have realized substantial rate changes. The shift in the Treasury curve is not isolated. The corporate curve is also changing.

Wait, what? The Fed cut interest rates and bond yields went up, not down. Yes, you read that right.

The Federal Reserve (Fed) Chairman seems to be happy with the market’s new wisdom regarding the path of interest rates going forward.

Your fixed income strategy does not necessarily need to be adjusted based on every personnel or environmental change.

With the outcome of the election now known, we will continue to assess how policy changes impact our broader view.

The yield on the 10-year Treasury surged to about 4.4% just after the election, even though it has come back down close to pre-election levels recently.

Explore how these two investment types compare.

Volatility is likely here to stay until we get some level of clarity on the political landscape.

Better than expected economic data drove interest rates higher, changing the market narrative and contributing to an equity market pullback early in the month. This unraveled expectations of further rate cuts by the Federal Reserve (Fed) and resulted in real rates moving higher. The 10-year Treasury has moved up 48 basis points, ending the month at 4.27%.

As you know, economists are normally criticized and accused of being ‘two-handed.’ This is because when we talk, we typically say, “on the one hand, and on the other hand.” Many argue that we are hedging our bets and lack the spine to take a position. While we disagree with that simplistic view of our job, we can understand why we are accused of being ‘two-handed.’

Get ready to ‘roll back’ the clocks! That’s right, Daylight Savings Time (DST) ends this weekend. This twice-a-year ritual is followed by every US state (except Arizona and Hawaii) and nearly 70 countries across the globe, but not everyone supports it.

Yields have risen from the dead since their recent lows in mid-September presenting investors with an opportunity that many were scared had disappeared following the FOMC’s 50 basis point rate cut at their last meeting.

The long and winding road to one of the most unusual presidential elections in history is coming to an end – with Election Day now just 11 days away.

Talking and exchanging communication with advisors and clients over the last several years has shown that many of them are concerned about the fiscal path of this country and the consequences it is having on our debt.

Senior Investment Strategist Tracey Manzi notes that while the predictive power of the inverted yield curve has waned this cycle, investors shouldn't dismiss the warning signs entirely.

The FOMC lowered the Fed Funds rate by 50 basis points at their September meeting. This was the first cut in over four years and the start of what is expected to be a multi-year easing cycle.

From current data, it is clear there are no signs the U.S. economy is currently facing challenges.

The S&P 500 is on track to deliver its second consecutive year of 20+% returns – a milestone it has not achieved since 1998. It is also on pace to deliver its strongest performance leading into an election year since 1932.

While tariffs have been utilized heavily in the past, both their usage and rates have fallen considerably over the past half century as countries have engaged in different stages of trade negotiations.

A tariff is a tax assessed on imports. Historically, tariffs have been enacted to generate tax revenue or to protect domestic producers from competition in the form of cheaper foreign goods. In essence, tariffs artificially make domestically produced goods more competitive in the local market by making imports more expensive.

Since hitting the October 12, 2022, low, the S&P 500 has climbed 65.9%! By historical standards, there is still plenty of room for the current bull market to run

The disruptive effects of the pandemic are still reverberating across the economy and giving incorrect signs, in this case, of the U.S. labor market.

We have openly promoted increasing duration over the last several months. An increase may seem like an odd “wish” as it implies taking on greater price risk.

A series of unprecedented and historic events has completely shifted the candidates and dynamics of the race for the presidency and Congress.

Just like road trips can bring unexpected detours, the economy and financial markets are at their own crossroads: recession or soft landing?

The recent fears regarding the state of the U.S. employment sector seemed to have disappeared completely this morning as markets are ‘recalibrating’ their view on the U.S. economy going forward.

As we look at today’s economy and financial markets, we are at a crossroads: Will it be a long straight highway to a soft landing, or will it be a bumpy road to recession?

September is typically the weakest month of the year for stocks, but thanks to the much-anticipated federal funds rate cut, the S&P 500 turned in its first positive performance in a September since 2019

For many investors, the fixed income portion of their portfolio is intended to be the ballast of the portfolio.

The economy reached an inflection point, with labor market conditions squarely in focus.

After the first rate cut in two years went according to market expectations as the Fed reduced the federal funds rate by 50 bps, markets have continued to run with the Fed’s ball and seem to have a ‘sugar rush.'

Explore fixed-income tools that generate income and infrastructure.

Fixed income strategy and opportunities have remained relatively unchanged over the past few months. However, the much-talked-about monetary policy change has commenced.

The seasons are changing. This weekend marks the autumn equinox—a time of year when the days get shorter, the weather gets cooler, and the leaves start to turn (at least for our friends in the north). While our calendars will show that fall has officially arrived, it may not feel like it as much of the nation will be enjoying unseasonably warm weather.

After more than six months of indicating that it lacked conviction regarding the path of inflation, the Federal Reserve (Fed) seems to have gotten a conviction boost so large that it pushed it to lower the federal funds rate by 50 basis points at the September Federal Open Market Committee (FOMC) meeting.

More than two years after first taking steps to contain swelling inflation, the Federal Reserve (the Fed) has taken a step back, suggesting monetary policy decision-makers have confidence that inflation will continue to move closer to the Fed’s target, allowing them to turn some attention to economic growth.

The half-percentage point reduction at the September 17-18 FOMC meeting represents the largest non-COVID era cut by the Fed since 2008.

Doug Drabik discusses fixed income market conditions and offers insight for bond investors.

The Federal Reserve (Fed), and markets, overreacted to the slightly higher inflation seen during the first quarter of the year. After that scare, the Fed went from expecting three cuts in the federal funds rate in 2024 to just one cut during its June dot plot release.

The time has come! After the most aggressive tightening cycle in modern history, the Fed is ready to turn the page and begin dialing back its policy restraint after the second longest ‘on hold’ period (14 months) in history. Barring any surprises, the Fed should lower interest rates at its meeting next week—the first rate cut in over four years—in the hopes of preserving a soft landing for the economy.

Fed officials must recalibrate their policy stance to ensure the economy stays on solid footing to achieve that elusive soft landing they have been aiming for after their quest to quash inflation.

Investors may find themselves prognosticating about future rates relative to current rates in an attempt to optimize their portfolio.

August’s employment report, which was weaker than markets were expecting but stronger than our call, cements our view that the easing cycle will begin during the next FOMC meeting, September 17-18.

When we’re viewing markets, it’s not surprising sentiment shifts quickly if we don’t instantly see the anticipated results. Market pundits quickly point fingers and determine the Fed, economists, and participants are wrong. Reactions can be powerful in number and sway momentum for stocks and/or bonds.

A soft landing for the U.S. economy still appears to be the most likely outcome.

Happy National Cheap Flight Day! Yes, you heard that right—there is a national celebration day to mark the start of a lull in travel demand. Who knew this would be a day to celebrate? Regardless, it’s good news for consumers as airfares should continue their recent downward trend!

As a businessman and ex-business owner, the idea of firms ‘hoarding’ workers never made sense. As an economist, the idea of firms hoarding workers never made sense either.

As recently as the beginning of this year the market pundits were predicting up to six Federal Reserve rate cuts to the short-term Federal Funds Rate. Shockingly, the pundits’ expectations have not come to fruition. Predictions based on the sentiment of the day fill the twenty-four-hour news cycle on multiple outlets.

This week marks the ‘unofficial’ end to 2Q24 earnings season – and aside from a few wobbles, it has been reasonably good. S&P 500 earnings growth came in at a solid 11.2% YoY pace – its best quarterly performance since 4Q21.

June’s rate of inflation showed, for the first time in several years, an important slowdown in shelter costs, something that economists, us included, have been expecting for a very long time but had not materialized.

Your portfolio can be the key to managing cash and maintaining flexibility.

The flexibility offered through individual bonds translates well for tailoring individual financial goals and needs.

During volatile times, it is important to maintain perspective, stay focused on your long-term objectives, and avoid knee-jerk reactions based on the latest twists and turns in the market.

When the Federal Reserve (Fed) cut rates in response to the COVID-19 pandemic, mortgage rates fell below 3% in 2021 and many households refinanced or obtained new loans.

Hastily, investors have turned their worry about inflation into worry about a recession. The catalyst was Friday’s unexpectedly disappointing unemployment number.

Take the market narrative with a grain of salt and look at the fundamentals in determining your outlook for the economy and financial markets. We ultimately believe this soft patch of data will prove to a be a ‘growth scare,’ not a ‘recession reality.’

The relative weakness in July’s nonfarm payroll employment number and the increase in the rate of unemployment from 4.1% in June to 4.3% in July, triggering the Sahm Rule is a reminder of the difficult tasks ahead for the Federal Reserve.

While election news dominated July's headlines, small-cap stocks had their best monthly performance relative to large-cap stocks since December 2000.

The Federal Reserve noted that inflation is moving closer to its 2% target after electing to hold rates steady at its July FOMC meeting.

We are approaching a turning point in policy decisions as the FOMC attempts to walk the fine line of hitting their inflation targets while maintaining a healthy labor market.

The Federal Reserve (Fed) doesn’t like to spook markets, that is the reason why it has crafted its communication on monetary policy to give indications way in advance and nothing has been pointing to a change of heart that could lead to a surprise move next week.

Following the historic decision by President Biden to drop out of the 2024 race, Raymond James CIO Larry Adam provides insight into his team's economic and market outlook.

There are many advantages and risks associated with any investment. Whether you are buying a stock, a house, a business, or a bond, each investment has unique characteristics that allow an investor to gain from particular investment features with varying risks.

As we start the second half of 2024 and we approach next week’s release of the preliminary report on real GDP for 2Q, we continue to expect 2H economic growth and inflation to downshift versus what we saw during 1H of this year.

Artificial intelligence is set to become a game changer for the electric power industry, notes Pavel Molchanov, Managing Director, Energy Analyst, Equity Research.

The dilemma that all Fed committees and chairpersons face when the economic cycle nears a turn but then repeats itself can be summed up with Fed chair Jerome Powell’s recent references: “Easing too soon, too much could harm inflation progress.” “Easing too little, too late could unduly weaken the economy.”

This week marks the official start to 2Q24 earnings season, with the big banks among the first to report. While much of the last six weeks has been dominated by the softening macro backdrop, the S&P 500 looked past the weakening data – notching 37 record closes already this year.

We want to repeat what we have said in the past: “One data point doesn’t a trend make.” However, the June data, after weaker than expected readings for April and May, confirm our suspicion that inflation numbers during the first quarter of the year were a fluke.

After a fruitful career and plenty of practice paying taxes, you may feel prepared for the tax man in retirement. But a review of your post-retirement taxable income may yield some surprising insights.

It’s an election year, which means you can expect to hear presidential candidates being asked about their plan for preventing Social Security from going bankrupt.

The global population has surpassed 8 billion and according to the United Nations, it is projected to reach 9.7 billion in 2050.¹ However, the rate of population growth is slowing and is expected to continue to decline. Seems counterintuitive, no?

It’s inevitable. A recession is coming. Whether it gets here next month, next quarter, next year, or next decade will be continuously debated until it arrives. Yet, one thing that everyone will agree on is that we will have another recession eventually.

Having hit 31 record highs since January and up more than 15% year to date, the S&P 500 is off to its best start to the year since 2019 and the best start to an election year ever, driven by mega-cap tech stocks and artificial intelligence (AI) tailwinds.

We’re borrowing from the upcoming Paris Summer Olympics for our quarterly theme – with a twist. Instead of using the most popular events (like gymnastics, swimming, and track & field) to express our views, we’ll go beyond the spotlight.

Doug Drabik discusses fixed income market conditions and offers insight for bond investors.

Key Takeaways

• The Fed will cut rates twice to support growth
• Interest rates are poised to tip lower
• The equity market should keep climbing longer term

Retail trade sales in the U.S. are reported by distribution channel. For example, gasoline sales are reported through the gasoline stations distribution channel, although those gasoline stations’ sales also include everything else sold at gasoline station convenience stores, i.e., hot dogs, tobacco, sodas, gum, chips, coffee, etc.

As you move through retirement, it’s important to set time aside to reflect on how you’re doing. While most people often focus on their health and finances, it’s equally as important to think about other areas of your life as you approach the midpoint of your retirement.

Although bonds may not always be able to significantly contribute to growing an investor’s wealth, their lower risk profile can bring comfort in positioning an investor to maintain that wealth.

After the S&P 500’s incredible run—up 57% from its October 2022 lows and with an election on the horizon, its normal for investors to wonder whether to take some chips off the table or hold off on investing to see what happens.

Total net worth, or household wealth, has reached a new record high, at least in nominal terms. This has pushed many to argue that Americans have been using the accumulation in net worth to increase consumption.

The Federal Reserve policy can set the tone that drives interest rates across the maturity range but an earlier market rate downturn can occur as a signal of investor perception of a slowdown in the economy.

The S&P 500 surpassed its 27th record high for the year this week—and still notching more (up to 29 already!)—driven by rising earnings, cooling inflation, and an economy that remains on solid ground.

For those of you who are not math geeks, ‘rise over run’ is the formula for the slope of a line. What does this have to do with the latest Federal Reserve (Fed) decision, you may ask?

The updated projection shows the likelihood of one rate cut by the end of 2024.

We are moving our first federal funds rate cut to September of this year compared to our current July call although we are going to get more information from Federal Reserve officials after the release of the Summary of Economic Projections and the new ‘dot plot’ on June 12.

Personal Consumption Expenditure (PCE) measures the price paid for goods and services by consumers. It reflects changes in consumer behavior and captures inflation (or deflation) across a wide range of consumer expenses. Prices for both goods and services are measured.

Why is there so much angst among investors? The mixed economic signals may have a lot to do with it.

Positive corporate earnings and greater participation from sectors other than technology carried stocks forward.

We connect the dots between the micro data points (what we learned during 1Q earnings season) and what we expect the forthcoming macro data will reveal about the state of the economy.

Survey after survey has been indicating that Americans feel worse off today compared to the recent past; so much so that many of them indicate the economy is currently in recession, that the rate of unemployment is the highest in several decades, that inflation is very high today, etc.

It’s natural to avoid loss, but sitting on the sidelines out of fear might lead to missed financial goals.

Market factors are constantly changing and require monitoring, analysis, and flexibility by the investors when it comes to choosing appropriate investments.

As we set our sights on the summer, here are five dynamics that could drive the financial markets between Memorial Day and Labor Day:

We are free trade enthusiasts, in economic terms, even at a time when free trade has been losing some of its aura within the U.S. political system.

As goes the consumer, so goes the U.S. economy. As Wall Street knows, the importance of the consumer cannot be overstated. That’s because consumer spending is the main engine of growth, representing ~70% of US economic activity – nearly 10% more of the economy than it did in the early 1980s.

To say that inflation data during the first quarter of the year surprised us and the markets is clearly an understatement and by Tuesday of this week, with the higher-than-expected Producer Price Index (PPI) print for April, markets were clearly on edge as they were also potentially expecting a higher reading for the Consumer Price Index (CPI) on Wednesday.

More than 338,000 Americans relocated for retirement last year – a 44% increase from 2022 – and about a quarter of those retirees moved to a different state.

The finance world can get complicated, especially for the passive or uninterested investor. Let’s face it, some of us are not curious about sports, movies, exercise, reading, or other things while others of us carry a passion for them.

Happy National Small Business Day! Every year on May 10, small businesses are officially recognized for their contributions to the US economy. And rightfully so. Small businesses are the backbone of the US economy.

Markets seem to have been basking in the spring sun as they wait for the approaching summer heat, so to speak.

A recap of the important drivers, along with our views on how things will play out over the rest of the year.

It can be easy to overthink the markets and it is human nature to try to out-guess, out-maneuver, or out-smart the average, but perhaps we can step back and simplify what seems to be occurring.

We try not to react to just one data point because, as we have always said, “a data point doesn’t a trend make.” Furthermore, we don’t know if this is just a one-time event or if it is the start of something more.

The Federal Reserve is looking for more confidence that inflation is headed back towards its 2% target before commencing with rate cuts.

The S&P 500 experienced its first 5% pullback since October 2023, but the long-term outlook remains positive.

One of the main advantages of constructing a portfolio of individual bonds is that it can be customized to meet the precise needs, wants, and objectives of the investor

The reaction from markets to the release of Q1 2024 real GDP results has given every sector of the market another chance to give their own interpretation of what is coming regarding Federal Reserve (Fed) policy, inflation, and the federal funds rate.

Discover the reasons investors diversify their portfolio with alternative investments.

Timing has never been a crucial undertaking for fixed income allocations dedicated to asset preservation largely because this is a long-term endeavor dedicated to keeping an investor’s wealth intact.

We put the recent market movements in perspective, which have been driven by time (it has been a while since we had a 5%+ pullback), overly optimistic, complacent market sentiment, and higher Treasury yields amid persistent inflationary pressures and signs of a more patient Fed.

The impact of high inflation on individuals’ finances is not something to take lightly, especially in the U.S., because for almost 40 years we have had no experience with such an event and have no clue how to deal with it or how to try to minimize its negative impact.

For a typical consumer, the two most hot-button topics are food and energy. Both play a significant role in household spending, and just as importantly, both are highly visible.

Fed Funds Rate: According to Bloomberg calculations based on where Fed Funds futures are currently trading, there is a 20% chance that the FOMC cuts the overnight rate in June and a ~50% chance that they cut in July.

Growth and inflation have remained remarkably resilient since the start of the year, causing the market to once again rethink the Fed’s rate path. As a result, the odds of a June rate cut have collapsed

Before we start discussing the Consumer Price Index again, we want to remind readers that CPI inflation is not what Federal Reserve officials use to determine monetary policy. It is true that markets put a lot of emphasis on this measure, but we would like to caution giving too much importance to it.

Senior Investment Strategist Tracey Manzi notes that with a Federal Reserve easing cycle on the horizon, the fixed income markets are relatively attractive.

This week’s discussion is a follow-up to last week’s overview of the elongation of the economic cycle.

While artificial intelligence and new technologies have captured the market's attention, this quarter we reminisce about the good old days and a key piece of technology that has endlessly entertained us all – classic video games.

Can Federal Reserve (Fed) officials live with such a strong labor market and still start lowering interest rates in June or July?

We are normally reluctant to use trendy phrases to explain either our good and/or bad calls regarding the U.S. economy. However, saying that ‘this time is different’ is more than fitting today to understand what has happened to the U.S. economy since the recovery from the COVID-19 pandemic.

Market rally driven by a broadening of the market and optimism that the Federal Reserve will deliver rate cuts later this year.

With technology changing the way we live, we are taking a trip down memory lane to look back at a piece of technology that has entertained generations: classic video games.

For lack of a better word, the fixed-income mantra is getting stale. Interest rates have peaked, and they remain at elevated levels, allowing investors to take advantage of higher income and ample cash flow opportunities.

The Federal Open Market Committee (FOMC) comprises the Federal Reserve System’s decision-makers on monetary policy in the United States. This monetary policy is designed to keep the Fed’s dual mandate of maximum employment and price stability in line with targets.

Larry Adam takes stock of how the economy and markets have performed since the beginning of the year and take a fresh look at where we are heading as we progress through the year.

Markets have taken the Federal Reserve (Fed) decision to keep about 75 basis points (bps) cuts in its dot plot as a very positive sign that the Fed is going to actually cut 75 bps during the year and are still acting upon the news.

The central bank will look to cut interest rates three times by the end of 2024.

Doug Drabik discusses fixed income market conditions and offers insight for bond investors.

Do you know that the headline Personal Consumption Expenditures (PCE) was 2.4% in January while the core PCE was 2.8%? This is very close to the 2% target.

With the U.S. economy posting two consecutive quarters of 3%+ GDP growth, recession calls have quieted down.

For many investors, fixed income is intended to serve as the ballast of a portfolio. This means that it hopefully provides stability in turbulent times while providing consistent and known income, cash flow, and return of principal.

Sometimes, and February was one of those times, the information on the U.S. labor market doesn’t make sense. Many argue that government agencies are cooking the books.

The move higher in the S&P 500 has been historic. In fact, the S&P 500 has climbed ~17% over the last four months and is on pace to rally 17 of the last 19 weeks.

Recessions are part of the economic cycle. No one looks forward to a recession because of the pain it can impose on investors or worse, job security.

The economy continues to hum along (Atlanta Fed 1Q24 GDP estimate: +3.0%), albeit shifting down a notch from the pace seen in the final quarters of last year.

Personal income increased more than expected in January, up 1.0% (or $233.7 billion). The increase in January closely matches what happened in January of 2023 when it increased by 0.95% (or $213 billion).

Equity investors didn't mind the extra day this February as both domestic large-cap stocks and small-to-mid-cap stocks saw steady gains through the month, bringing both groups into positive territory year-to-date, though the latter continues to lag.

Rob Tayloe discusses fixed income market conditions and offers insight for bond investors.

Four years ago this week (2/19 to be exact) the S&P 500 climbed to an all-time high of 3,386 before plunging over -34% as the world economy shutdown due to the pandemic.

From a very weak retail sales report for January 2024 to stronger inflation readings as well as increases in credit card and auto loan delinquency rates during the last quarter of 2023, the picture for consumer demand has weakened considerably.

Even at the risk of sounding like a parrot by repeating the same thing again and again, we think that it is, once again, appropriate at this time to do so: “One data point doesn’t a trend make.”

One of the major benefits of municipal bonds is that the interest earned is exempt from federal income taxes. The appeal of earning money that you do not have to pay taxes on understandably piques the interest of many investors.

Once again, as we have argued several times before, if the Fed, once after having achieved its 2% target and remained at the target for several years, decides that a different target may be more effective for conducting monetary policy, they may decide to change the target.

Most of us associate 529 accounts with college savings. They’re flexible, allowing you to transfer assets to anyone, including yourself, for the express purpose of furthering the education of your beneficiary. But did you know that a 529 can be a powerful estate planning tool?

Mega-cap Tech names have been strong outperformers year-to-date. In fact, a composite of the biggest names, or MAGMAN (MSFT, APPL, GOOGL, META, AMZN, NVDA) is up 12%, while the rest of the S&P 500 is up just 2%.

Whether you have a family member turning 18, or someone in your life looking to build wealth from the bottom up, this primer provides a solid overview of the basic types of securities, investing strategies, and valuable lessons to help pave the path toward financial confidence.

The can has been kicked down the road several times but it feels like the end of the road is in sight.

Markets have made themselves clear for a while: they want more rate cuts than what Federal Reserve (Fed) members seem to be willing to accept at this time.

A period of market volatility and consolidation is likely as markets have already priced in much of the economy's good news.

The Fed concluded its January policy meeting leaving interest rates unchanged, which was widely expected.

The Federal Reserve (Fed) elected to not raise the federal funds rate at the January 2024 Federal Open Market Committee (FOMC) meeting.

For many investors, fixed income investments have a primary objective of preserving wealth. The known characteristics of owning individual bonds are a major reason for this: known income, known cash flow, known redemption date, known redemption value.

In the middle of 2023 we argued that, according to our forecast for GDP at the time for the whole of 2023, employment was growing too fast and that it would have to slow considerably during the second half of the year.

Mega-cap tech-related names (MAGMAN) drove equity returns in 2023. However, heading into 2024 market consensus expected returns to broaden to other equity sectors and market cap sizes.

Many investors buy individual bonds as a means to preserve their wealth. They can serve as a method to balance growth assets (such as stocks).

Treasury yields have steadily climbed since the start of the year, with the 10-year Treasury yield rising back to 4.16% after reaching a low of 3.79% in late December.

The negative side of the strong increase in mortgage rates has fallen on those who did not have a home before the start of the increase in rates and on the ability of those Americans to purchase a home.

Stronger-than-expected growth, concerns about the U.S. government's fiscal outlook and the Federal Reserve's (Fed's) pledge to keep interest rates higher for longer drove yields to levels not seen in decades.

We did an internal survey among our associates, attempting to get a feel for their views on various economic and fixed income topics. Any survey result concerning the future can net inexact results but nonetheless reveal general sentiment. Attitude, outlook, and opinions can help shape the market.

Currently, consensus earnings growth is expected to be 1.3% YoY for the fourth quarter, which would mark a deceleration from 3Q (+6.1%).

We have read plenty of analysis on what the Federal Reserve (Fed) should do as it decides when to start lowering interest rates this year. Much of the analysis is well-intentioned as well as based on very good arguments.

A lot was going on with rates in 2023, yet, at the end of the year how different were things? The 10-year Treasury yield's lowest closing was 3.30%, while its highest close was 4.98%.

The Federal Reserve (Fed) left the door so wide open after the end of the Federal Open Market Committee (FOMC) meeting in mid-December 2023, that markets have run ahead and have continued to push long-term rates lower since the decision was announced.

The long-awaited recession never materialized in 2023 as the sectors of the economy rotated from hot (i.e., travel and leisure) to cold (i.e., housing) over the last few years.

The S&P 500 reversed its 2022 losses, and then some, closing the year near a record high.

Welcome to 2024! As we wade into the new year, you will undoubtedly read and hear a wide range of forecasts predicting what financial markets are going to bring us over the next 12 months.

Here are our 10 themes for 2024. Count on more than a few surprise ingredients throughout the year to spice up the financial markets.

The year 2023 will be remembered by economists and investors as 365 days of resiliency and defied expectations. This week’s Weekly Economics will dive into the U.S. economic landscape and summarize the major factors that shaped the nation’s economic trajectory this year.

The year-end fiscal 2023 government funding bill contained legislation that makes the most significant changes to the U.S. retirement savings system in decades. The SECURE 2.0 Act builds on retirement savings changes passed in 2019 and contains new provisions that further raise the required minimum distribution (RMD) age, shift to automatic plan enrollment and provide for new matching/emergency withdrawal opportunities.

The market has been indecisive but with reason. 2023 has been filled with strong opinions however, many of the opinions are of contrasting beliefs. Reading the future is not easy.

Over the last few months, we have highlighted that the Fed should be done with its tightening cycle based on real-time, high-frequency data that suggested that economic growth and inflation were cooling.

November’s inflation numbers delivered good news for the Federal Reserve (Fed) even though the Consumer Price Index (CPI) was higher than what markets were expecting, with shelter costs surprising to the upside.

The last three years have seen extraordinary market turbulence and ever-changing market narratives – from COVID-19 to inflation, rising interest rates to geopolitical instability.

A tentative timeline toward rate cuts in 2024 was revealed in the updated Summary of Economic Projections.

Doug Drabik discusses fixed income market conditions and offers insight for bond investors.

To argue that the U.S. consumer has remained resilient has become a cliché and at the same time an understatement. After a very strong increase in real incomes during the pandemic, real income growth started to slow considerably.

Investors are beginning to price in a 'soft landing' as the base case over the next 12 months. This is evident across a number of indicators.

The financial markets, investor opinions, and world events have been all over the place – so bear with me this morning as I am going all over the place with a variety of year-to-date observations and comments.

Our forecast for the federal funds rate has the Federal Reserve (Fed) starting to cut rates in July 2024, with a second rate cut before the end of 2024.

For much of 2023, the market has tried to anticipate a Fed pivot – only to be wrongfooted several times. However, sharply higher interest rates, cooling inflation pressures and moderating wages have the market convinced that the Fed’s current tightening cycle is over.

Drew O'Neil discusses fixed income market conditions and offers insight for bond investors.

Doug Drabik discusses fixed income market conditions and offers insight for bond investors.

October news on CPI inflation was all the doctor recommended and has markets spinning and repricing the Federal Reserve’s (Fed) potential path forward.

Following the surge in inflation, the most aggressive Fed tightening cycle since the 1980s and multi-decade lows in business and consumer confidence, calls for a U.S. recession have been prevalent all year.

We understand that many economists/analysts/market participants are already discounting inflation as a serious problem for the U.S. economy. Even if this seems correct on the surface, the problem is very different for those who suffer the most from higher prices – middle- and lower-income individuals.

Good news – the earnings recession is over! After three consecutive quarters of negative earnings growth, 3Q S&P 500 earnings are on pace to climb 5% YoY. If sustained, this would be the best quarter of earnings growth since 2Q22.

The 2- through 30-year Treasuries rallied hard to drop yields from 12 to 18 basis points. By example, the 10-year Treasury price bottomed out at $91.86 (4.93%) and peaked at $95.25 (4.48%). This is a 3.4-point price swing or 45 basis point drop in yield.

After the October/November meeting, it seems that Fed officials have an added objective, as Fed Chair Jerome Powell said during the press conference that they needed to see interest rates “persistently high.”

The Federal Reserve (Fed) elected to not raise the federal funds rate at the October/November 2023 Federal Open Market Committee (FOMC) meeting.

While 3Q23 growth showed the economy expanded at a 4.9% annualized rate, it is important to remember that the GDP report is backward-looking.

Yields are at some of their highest levels in over a decade. This means that if you own fixed income in your portfolio, there is a good chance that you are seeing unrealized losses on your monthly statements (fixed income math = yields higher, prices lower).

Chief Economist Eugenio J. Alemán discusses current economic conditions.

Much like Halloween, it has been a scary time for investors.

Higher for longer. The Federal Reserve will likely maintain higher interest rates and remain open to another rate hike. Borrowing costs for households, businesses and governments have risen with soaring rates.

The strength in consumer demand has been one of the defining characteristics of a very resilient U.S. economy and September’s retail and food services sales report confirmed that the U.S. consumer is alive and well.

I was asked a pretty good question following an internal meeting late last week. The question started out by noting that we have been promoting going longer on the curve for a while now and then asking why we think longer-term rates will come down.

With next week’s 3Q GDP report shaping up to be a blockbuster number (the Atlanta Fed GDPNow is tracking a +5.4% growth rate), it is worthwhile to reiterate our thoughts on the economy and how we expect growth to unfold over the next year.

We hear and read daily analysis on how inflation is coming down and that the Federal Reserve (Fed) has beaten inflation. This is probably very close to the truth from an economics point of view.

As a strategist, I work with financial advisors every day creating custom fixed income portfolios based on client’s financial needs and goals – with a keen eye on the importance of a balanced portfolio.

The Federal Reserve (Fed) only controls one rate of interest, and it is a very short-term rate called the federal funds rate, the rate that banks charge each other for overnight, intra-bank loans.

The recent repricing in longer-maturity yields has pushed the 10-year Treasury yield to levels not seen in 16 years.

When the media speaks of the yield curve, they are likely referring to the Treasury yield curve. It is the point of reference for interest rate levels and investment comparison.

As heightened inflation has lingered, the Federal Reserve diminished hopes of 2024 interest rate cuts and economic data suggests a mild recession in the first half of 2024.

Investors had gotten used to smooth sailing with the economy remaining resilient, the equity market soaring double digits, and volatility remaining (mostly) subdued.

While government shutdowns impact the economy directly and indirectly, the magnitude of the impact is determined by the length and scope of the shutdown. Some operations can continue in a “partial shutdown” scenario, and thus impact the economy differently.

Inflation has declined considerably from last year’s peak of ~9.0% to ~3.7%. However, policymakers still think they have more work to do and have signaled that one additional rate hike is likely.

Downside equity market volatility can be unsettling, but it is important to put the pullback in perspective and identify the drivers of the negative market reaction. First and foremost, the equity market was due for a modest pullback.

Anyone who even casually pays attention to the financial media has likely become familiar with the current state of inflation as well as how high interest rates have risen over the past ~2 years.

Wednesday’s Federal Reserve (Fed) decision to keep the federal funds rate unchanged wasn’t a surprise at all. Markets, as we argued last week, had predicted that the Fed was going to stay put and that is what it did.

While our Washington Policy analyst believes there is a path to a resolution to avoid a government shutdown ahead of the looming September 30 deadline, the rhetoric out of Washington suggests otherwise.

For the second time in four months, the central bank decided to not increase interest rates but indicated another hike in 2023 is likely.

Inverted curves (when the gold line goes below the red line meaning that short maturity yields are higher compared to longer maturity yields) have preceded recessions.

Markets are convinced that the Federal Reserve (Fed) is going to pause its interest rate campaign after it finalizes its Federal Open Market Committee (FOMC) meeting on Wednesday, September 20.

The Energizer Bunny! That’s the term that best describes the U.S. economy.

If held until the bond is redeemed (either by call or maturity), the annual yield earned for the life of a bond is known upfront at the time of purchase. Knowing the return on an investment upfront makes long-term financial planning a much easier task.

For the savvy private wealth investor, portfolio diversity is key to success. Investing in infrastructure is one option that can help you both optimize your portfolio and make a positive and meaningful impact on your local community.

There has been lots of speculation lately regarding China’s economic “decline” or potential economic “perils,” so much so that newspaper articles about the coming demise of China’s miracle economic growth over the previous decades continue to take (our) time away from other, perhaps, more important topics.

When you step back and think about it, it is hard to believe that this hugely important retirement benefit has only been around for just over 40 years.

In general, portfolios can be split into growth assets and principal protecting assets. Growth assets tend to have greater risk coupled with greater income/reward.

Last week we changed our economic forecast because the economy has remained stronger than we expected. We delayed the start of the recession to the first quarter of 2024 rather than the last quarter of 2023.

A steady stream of news helped drain enthusiasm from the equities markets through most of August, snapping a five-month growth streak at a time of the year known for cool market performance despite the swelter of its dog days.

While the S&P 500 delivered solid performance this summer, we remain cautious in the near term given the Index remains modestly above our year-end target of 4,400.

Sometimes things sound the same, look the same, or feel the same – but they are not. It doesn’t necessarily mean one is better or worse than another but uniquely dissimilar and serving, unlike purposes.

It’s hard to see your portfolio dip and not panic – especially as you near retirement. Coupled with record inflation, a dip might tempt you to sell your investments to drive cash flow.

Watching coverage of the BRICS (Brazil, Russia, India, China and South Africa) summit in South Africa this week made us wonder why the members of the BRICS decided to name the section, in which Vladimir Putin was addressing the conference by video conference, “BRICS BUSINESS FORUM,” in English, yes?

It’s premature to call off a recession. Lower shelter costs will ease inflationary pressures. Treasury supply dynamics caught the market by surprise.

If you’re interested in investing in mutual funds or exchange-traded funds (ETFs) – or you already have some in your portfolio – you may be wondering what exactly the difference is between an active and a passive fund.

Nick Goetze discusses fixed income market conditions and offers insight for bond investors.

We have heard lots of commentary on the student loan repayment issues facing almost 44.5 million Americans. Some of these commentaries are correct but there are others that miss the mark.

While economic growth drives corporate earnings, remember that the S&P 500 is not a replica of the U.S. economy.

Consumer spending remains the lifeblood of the economy accounting for nearly two-thirds of economic activity.

Once again, markets are taking the elevator while economic data takes the stairs.

Doug Drabik discusses fixed income market conditions and offers insight for bond investors.

Coming into the year, over 60% of economists expected the economy to enter a recession in 2023. But the economy’s resilience, particularly in the wake of aggressive rate hikes, has surprised the market and supported better than expected earnings growth and the equity rally year-to-date.

For now, and according to the June Summary of Economic Projections (SEP) ‘dot-plot,’ the Fed still has one more 25 basis point increase for the federal funds rate before the end of this year.

Market volatility is an inevitable part of investing. And, understandably, tumultuous times will likely trigger emotional responses to match.

Drew O’Neil discusses fixed income market conditions and offers insight for bond investors.

Raymond James CIO Larry Adam examines the reasons for the decision and what the impact may be on the financial markets.

As that information presents itself, we may see a fair bit of market choppiness. This is why, even though the market’s monthly moves are fascinating and informative, they are far from instructive for a long-term investor.

The question many economists, as well as market participants, asked themselves after the June Federal Open Market Committee (FOMC) meeting was why the Federal Reserve (Fed) paused its federal funds rate hike campaign if they were going to increase it again in July anyway.

Record-breaking heat waves dominate the news headlines, with 2023 shaping up to be one of, if not the hottest year on record. Extreme temperatures are shattering records across the U.S., Europe and in parts of Asia – not just on land, but also in the sea.

After breaking its string of 10 consecutive interest rate hikes in June, the Fed elected to raise the federal funds rate by 25 bps at its July 26, 2023, FOMC meeting.

A professional advisor can craft a tailored, holistic financial plan that supports your needs, goals and intentions for the future.

High-quality investment grade municipal bonds provide growth-like returns for investors in a relatively more conservative investment vehicle than equities. Have your financial advisor assess the opportunity as it pertains to your specific goals.

Mortgage rates are the highest they’ve been in over 30 years, keeping home affordability in unprecedented territory. However, mortgage rates above 7% aren’t the only factor keeping home prices high.

With inflation falling and growth slowly grinding lower, time is running out on many global central bank tightening cycles – especially for the Federal Reserve (Fed) that meets next week.

Markets can present challenges for investors as volatility, direction, supply, outside influences, and future expectations are continuously changing.

Chief Economist Eugenio J. Alemán discusses current economic conditions.

The Fed is executing its playbook according to plan – get interest rates up quickly, keep tightening albeit at a more moderate pace, and then hold rates steady to allow real rates to nudge higher as inflation recedes.

Ed Mills, Managing Director, Washington Policy, discusses how recent U.S. policy decisions are the foundation for an industrial renaissance aimed at building up the economic base and protecting it against certain geopolitical and supply chain risks.

While this is a market estimate and in no way guaranteed, let’s just pretend for a minute that there is a 100% chance of this coming true and the FOMC is going to raise the Fed Funds rate by an additional 50 basis points.

Chief Economist Eugenio Alemán and Economist Giampiero Fuentes note that while it is taking longer to bring inflation down, the Fed will continue to conduct monetary policy to reach its target rate.

Chief Economist Eugenio J. Alemán discusses current economic conditions.

The tech sector was the MVP of the first half. Tech is likely to maintain All-Star status in the second half.

Following a strong start to 2023, CIO Larry Adam and his team share their outlook for the remainder of the year.

Better than expected first quarter earnings, decelerating inflation and growing optimism about a soft, non-recessionary landing have driven the market's positive 2023 start.

Rob Tayloe discusses fixed-income market conditions and offers insight for bond investors.

The U.S. economy grew at a more-than-expected 2.0% annualized rate of growth during the first quarter of the year compared to the previous quarter. In some sense, this rate of economic growth makes a little bit more sense than the previously reported 1.3% rate...

This weekend marks the official start of the Tour de France – one of the biggest cycling events in the world! Cyclists begin their journey in Bilboa, Spain and over the next 23 days will traverse through challenging terrain, covering a grueling ~2,200 miles.

Did you know that American forests offset 12% of total U.S. emissions? With wildfires back in the headlines, Energy Analyst Pavel Molchanov discusses the crucial role of reforestation efforts.

The Federal Reserve (Fed) still has a very tough job ahead to bring inflation down to its 2% target over the long run while facing pressures from markets, which have a very different timetable than the Fed.

This past Wednesday marked the official start of summer! The summer solstice represents the best time of year – the maximum amount of daylight coupled with warm temperatures.

Doug Drabik discusses fixed income market conditions and offers insight for bond investors.

The surprising resilience of the economy despite the aggressive tightening remains the Fed’s biggest challenge at this point in the cycle. Below we discuss how the Fed’s thinking will likely evolve for the remainder of the year and what it means for the markets.

Chief Economist Eugenio J. Alemán discusses current economic conditions.

Doug Drabik discusses fixed-income market conditions and offers insight for bond investors.

For the first time since beginning the current tightening cycle in March 2022, the Fed opted against raising the federal funds rate at the June 14, 2023, FOMC meeting. The decision officially ends a run of 10 consecutive interest rate hikes by the central bank.

Chief Economist Eugenio J. Alemán discusses current economic conditions.

While the Fed wants to retain optionality on further hikes and affirm rate cuts are not on the horizon for this year, we anticipate that slowing economic momentum and easing inflation pressures will lead to the beginning of an easing cycle in 2024.

Chief Economist Eugenio J. Alemán discusses current economic conditions.

Doug Drabik discusses fixed-income market conditions and offers insight for bond investors.

Managing substantial wealth often requires specialized capabilities and expertise.

Choppiness in the equity market continues as investors look to see a debt limit deal approved.

Nick Goetze discusses fixed-income market conditions and offers insight for bond investors.

Review the latest Weekly Headings by CIO Larry Adam.

Chief Economist Eugenio J. Alemán discusses current economic conditions.

Diversification is a cornerstone of thoughtful, long-term focused investing. Incorporating assets and asset classes that don’t always move in tandem – that is, their returns aren’t strongly correlated – can help temper stock and bond market risk.

Review the latest Weekly Headings by CIO Larry Adam.

Chief Economist Eugenio J. Alemán discusses current economic conditions.

Doug Drabik discusses fixed-income market conditions and offers insight for bond investors.

Review the latest Weekly Headings by CIO Larry Adam. Tighter lending standards still pose a risk. The debt ceiling issue will get resolved. The earnings outlook is improving.

This week’s inflation numbers were mostly positive and benign for the U.S. economy as well as for the Federal Reserve (Fed) and confirms our view that, at least for now, the Fed is done increasing interest rates for this monetary tightening cycle.

Review the latest portfolio strategy commentary from Mike Gibbs.

Lawmakers in Washington set government spending and revenue plans every fiscal year, usually producing a shortfall that many of us know as the federal budget deficit.

Doug Drabik discusses fixed-income market conditions and offers insight for bond investors.

With regional bank volatility grabbing headlines, CIO Larry Adam looks at what this activity means for the economy and asset classes.

Key Takeaways

• Stocks and bonds perform well after the last rate hike
• The bar for cutting rates is higher than it has been in the past
• First-quarter earnings results have been better than feared

If there was a message the Federal Reserve (Fed) wanted to make clear after the end of the Federal Open Market Committee (FOMC) meeting on May 3, it was that it reserves the right to remain hawkish.

On the heels of its 10th consecutive rate hike since March 2022, the Federal Reserve hedged its bets on pausing rate adjustments.

Along with identifying your goals and time horizon, assessing risk is a key part of building a holistic financial plan. And while affluent investors generally have higher risk tolerances, determining their individual risk profiles isn’t straightforward.

As the name implies, loss aversion is our instinct to not just prefer a gain over a loss but to prioritize avoiding losses over almost anything. It might sound wise to try avoiding losses but taking it too far could keep you from realizing your financial goals.

Though equities have proven resilient, more of the long-expected effects of the Federal Reserve’s (the Fed’s) rapid interest rate-raising policy arrived in April.

Key Takeaways

• The Fed’s tightening cycle is coming to an end
• Concerns about the debt ceiling impasse are rising
• Mega-cap earnings will be key to watch

The current Federal Reserve’s (Fed’s) tightening cycle is approaching an end. This has been one of the most forceful as well as the fastest tightening cycle in history. However, because the federal funds rate was well below the neutral federal funds rate, the time it has been above that neutral level has not been that long.

Over the last week, the market saw volatility pick up after approaching the upper end of what we believe is the near-term trading range.

Short-term Treasury yields skyrocketed throughout 2022 reaching levels not seen in almost 15 years. In early October, the yield of the 6-month T-bill topped 4% for the first time since 2007 and by the end of the month had topped 4.5%.