Until the last 24 hours I was the only one I can remember that mentioned recession this year as I did in my January 31 piece I wrote. (attached)  I will get to that in a moment.

When you have a violent selloff in the markets like we have had in the last 35 days it is best in my opinion to first put it in perspective on the big picture as it relates to your financial plan.  Look at your starting balance in January 2023 until close of business today.  That 26 months and 4-day return may be your best ever. 

Unlike so many CIOs and talking heads in the markets I always try to end my pieces with some action steps as I did in January.  Hope is not a strategy.

So, what to do now and is politics or market cycles going to lead the day?  Presidential politics have historically not been disruptive in the long term but as we are learning today can be quite disruptive on the short term.  Getting back to what I wrote after the election and again in January it the market risks that matter the most.  Valuations are still very high, so earnings must be perfect for the bull market to continue.  (see attached Tariff and market piece from our friends at Kestra Investment Management).

While these tariffs are very inflationary what is not inflationary is job loss, investor and economic confidence declines and a weakening housing market. While a recession may or may not be in the works, even the discussion of one can bring down prices.

While it may feel to some the markets are really selling off, in 2022 the first half of the year the S&P 500 was down 21% and ended the year down 19%.   As of today, the S&P 500 is down about 2.5% this year so far and the Nasdaq is down about 6%.

From a strategy perspective my desire to hold cash the last half of 2024 until now has been cautionary and for those wanting to add quality companies to your portfolios this has been the best entry point in quite some time.

Please call with any question and know we are on this and focused 100% of the time.