The Week That Was - March 21, 2025

Reading Between the Lines

This week showed us the market's emotional nature. When Federal Reserve Chair Jerome Powell offered reassuring words about inflation management, investors responded positively.

The 8% pullback in the S&P 500 from its peak isn't necessarily cause for alarm - it's more like a necessary pit stop on a longer journey. 

Something I found interesting in the face of this pullback was the surge in insider buying, with corporate executives purchasing their own company shares at the highest rate since last June. 

This can be looked at as a chef "eating his or her own cooking." It's often viewed as a vote of confidence by those in the know.

Meanwhile, international markets are outperforming the U.S. this year, potentially due to the ripple effects of President Trump's tariff policies.

Adjusting Expectations

Economic outlooks are shifting based on the changing landscape.

As an example, JPMorgan recently revised its growth projections, factoring in tariff impacts and policy uncertainty. 

The Fed could be stuck between a rock and a hard place with its interest rate policy. While two rate cuts remain on the table for this year, Powell emphasized flexibility. Basically, they don't want to cut rates and invite an inflation resurgence. On the other hand, they don't want to be too restrictive with their policy and crush the economy.

(I've always thought that Fed Chair is the least desirable job in the world. Sure, they make a lot of money and are super important, but it's an incredibly stressful job, and most people dislike you!)

A silver lining worth noting: household net worth remains historically strong relative to disposable income. This means that we have some breathing room to get us through some rough patches.

That's Gold, Jerry

Gold is having its day in the sun, responding to the perfect storm of inflation concerns, geopolitical tensions, and central bank buying. 

Many people are hesitant to buy something as it hits all-time highs, as gold is, but historical data suggest this rally might have staying power. 

Your Financial Compass

In times like these, it's easy to get caught in the daily market drama. Just remember that financial journeys aren't sprints; they're marathons with changing terrain.

Just as you wouldn't dramatically change your route on a cross-country trip because of a single traffic jam, your investment strategy shouldn't pivot with every market headline.

The noise will continue and will probably get louder - rate speculation, earnings questions, and policy shifts. Our job is to cut through the noise and manage portfolios with a level head.

If recent market movements have you questioning your course, let's connect.