Blog
The Markets
Emotions were running high in financial markets.
You may recall the week before last ended with the Standard & Poor’s (S&P) 500 Index falling more than two percent after a flare-up in the trade war between the United States and China. It marked the end of the longest streak of trading days without a move of one percent or more since 2020, wrote Connor Smith of Barron’s.1
“On Monday, [stocks] bounced much of the way back after President Donald Trump said over the weekend, ‘Don’t worry about China.’” reported Teresa Rivas of Barron’s. “As indexes climbed, Wall Street’s fear gauge came back down from Friday’s spike: The CBOE Volatility Index, or VIX, closed Monday at 19.03, down 12% on the day.”2
From there, it was a bumpy week. When investors worried, the VIX rose. When they calmed, the VIX fell. The VIX rose above 20 – the baseline for normal volatility in the market – and fell below 20 multiple times over five days. It topped out at 28 on Friday before finishing the week just above 20.3 Here are a few of the factors that affected investors last week:
- Regional banks and bad credit. The head of a large global bank “raised a red flag—he used the word ‘cockroach’—about the bad credit that a handful of banks face. Bank stocks fell hard. The selloff came just after all of the big banks had posted solid earnings and confirmed that everything was under control, which underpins the case for buying the stocks,” reported Jacob Sonenshine of Barron’s.4
- An AI bubble. There was uncertainty about the prospects for artificial intelligence (AI), too. “…a growing group of analysts and investors say that the numbers simply don’t add up—that tech companies will never be able to generate the revenue necessary to recoup their spending, reported Christopher Beam of Bloomberg.5
- Tariffs and trade. It was a contentious week for trade. On Friday, the administration expressed “optimism that talks with Chinese officials could yield an agreement to defuse the tariff spat between the world’s two biggest economies,” reported Rita Nazareth of Bloomberg. Markets celebrated.6
Despite the tumult, major U.S. stock indexes finished the week higher.7 Yields on U.S. Treasuries ended the week near where they started.8
Data as of 10/17/25 | 1-Week | YTD | 1-Year | 3-Year | 5-Year | 10-Year |
| Standard & Poor’s 500 Index | 1.7% | 13.3% | 14.1% | 21.9% | 13.8% | 12.6% |
| Dow Jones Global ex-U.S. Index | 0.2 | 23.2 | 18.9 | 17.2 | 6.9 | 5.0 |
| 10-year Treasury Note (yield only) | 4.0 | N/A | 4.1 | 4.0 | 0.8 | 2.0 |
| Gold (per ounce) | 6.3 | 61.8 | 57.1 | 36.4 | 17.3 | 13.7 |
| Bloomberg Commodity Index | 1.5 | 7.0 | 7.4 | -2.3 | 7.5 | 1.8 |
S&P 500, Dow Jones Global ex-US, Gold, Bloomberg Commodity Index returns exclude reinvested dividends (gold does not pay a dividend) and the three-, five-, and 10-year returns are annualized; and the 10-year Treasury Note is simply the yield at the close of the day on each of the historical time periods.
Sources: Yahoo! Finance; MarketWatch; djindexes.com; U.S. Treasury; London Bullion Market Association.
Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly. N/A means not applicable.
THE STORIES THAT SHAPE THE ECONOMY. There is a branch of economic study called Narrative Economics. It’s the brainchild of Nobel Prize–winning economist Robert Shiller who believes that viral stories (narratives) influence human behavior and move the economy.9
Ernie Tedeschi, Director of Economics at the Budget Lab at Yale, talked about narratives in a Bloomberg opinion piece recently. He said three stories are influencing our perceptions about the economy and he believes these narratives should be treated with some skepticism.10
Narrative #1: Artificial intelligence (AI) is behind the surge in U.S. economic growth. Tedeschi says AI may be getting too much credit.Investment in AI surged by 40 percent – to $1.4 trillion – from 2021 to 2025. What people forget is that a lot of that investment came from outside the United States.10
During the first half of this year, “AI-related commodities — software, information processing equipment and data centers — accounted for 1.3 percentage points of the 1.6% annualized real GDP growth…a staggering amount.” However, once AI-related imports are subtracted, AI contributed 0.5 percentage points to GDP. AI still a played a significant role in growth, but other factors are also having a sizeable effect.10
Narrative #2: AI is weakening the labor market. There is a lot of talk about how AI is replacing, or will replace, workers. This idea should be taken with a grain of salt because, “The biggest increase in unemployment over the last two years is in occupations with both the highest and lowest exposure to AI.”10 In other words, other factors are contributing to unemployment.
Narrative #3: Wealthy consumers are driving economic growth. Tedeschi said that it’s possible the United States is in a K-shaped recovery where the wealthy are doing well, while people with less wealth are not. However, he cautioned that “reliable spending data, with the necessary detail to track different households and validate private data, is often lagged by years.”10
The Economist recently offered a new narrative that may influence our outlook: The stock market is responsible.11 Here’s what they said:
“But does the stockmarket power the economy? At most points in time, it would be a ridiculous question. In recent months, though, the rise in American share prices has coincided with, and been fed by, a rush of popular enthusiasm for investing. And as people see the [markets] go up, they become more likely to spend. Now the answer to the question has important implications for the path of America’s stockmarket boom and its economy.”11
It’s something to think about.
WEEKLY FOCUS – THINK ABOUT IT
“Happiness is when what you think, what you say, and what you do are in harmony.”12 –Mahatma Gandhi, Spiritual and political leader
* These views are those of Carson Coaching, not the presenting Representative, the Representative’s Broker/Dealer, or Registered Investment Advisor, and should not be construed as investment advice.
* This newsletter was prepared by Carson Coaching. Carson Coaching is not affiliated with the named firm or broker/dealer.
* Government bonds and Treasury Bills are guaranteed by the U.S. government as to the timely payment of principal and interest and, if held to maturity, offer a fixed rate of return and fixed principal value. However, the value of fund shares is not guaranteed and will fluctuate.
* Corporate bonds are considered higher risk than government bonds but normally offer a higher yield and are subject to market, interest rate and credit risk as well as additional risks based on the quality of issuer coupon rate, price, yield, maturity, and redemption features.
* The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. You cannot invest directly in this index.
* All indexes referenced are unmanaged. The volatility of indexes could be materially different from that of a client’s portfolio. Unmanaged index returns do not reflect fees, expenses, or sales charges. Index performance is not indicative of the performance of any investment. You cannot invest directly in an index.
* The Dow Jones Global ex-U.S. Index covers approximately 95% of the market capitalization of the 45 developed and emerging countries included in the Index.
* The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
* Gold represents the 3:00 p.m. (London time) gold price as reported by the London Bullion Market Association and is expressed in U.S. Dollars per fine troy ounce. The source for gold data is Federal Reserve Bank of St. Louis (FRED), https://fred.stlouisfed.org/series/GOLDPMGBD228NLBM.
* The Bloomberg Commodity Index is designed to be a highly liquid and diversified benchmark for the commodity futures market. The Index is composed of futures contracts on 19 physical commodities and was launched on July 14, 1998.
* The Dow Jones Industrial Average (DJIA), commonly known as “The Dow,” is an index representing 30 stock of companies maintained and reviewed by the editors of The Wall Street Journal.
* The NASDAQ Composite is an unmanaged index of securities traded on the NASDAQ system.
* International investing involves special risks such as currency fluctuation and political instability and may not be suitable for all investors. These risks are often heightened for investments in emerging markets.
* Yahoo! Finance is the source for any reference to the performance of an index between two specific periods.
* The risk of loss in trading commodities and futures can be substantial. You should therefore carefully consider whether such trading is suitable for you in light of your financial condition. The high degree of leverage is often obtainable in commodity trading and can work against you as well as for you. The use of leverage can lead to large losses as well as gains.
* Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
* Economic forecasts set forth may not develop as predicted and there can be no guarantee that strategies promoted will be successful.
* Past performance does not guarantee future results. Investing involves risk, including loss of principal.
* The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee it is accurate or complete.
* There is no guarantee a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.
* Asset allocation does not ensure a profit or protect against a loss.
* Consult your financial professional before making any investment decision.
Sources:
1 https://www.barrons.com/livecoverage/stock-market-news-today-101425/card/the-vix-is-spiking-the-market-now-sits-at-an-inflection-point–VsmDYuAtmJ56PfEycSLX?mod=Searchresults or go to https://resources.carsongroup.com/hubfs/WMC-Source/2025/10-20-25-Barrons-The-VIX-Is-Spiking-1.pdf
2 https://www.barrons.com/articles/stocks-rebound-bank-earnings-bull-market-596bf65d?mod=Searchresults or go to https://resources.carsongroup.com/hubfs/WMC-Source/2025/10-20-25-Barrons-Review-and-Preview-A-Quick-Recovery-2.pdf
3 https://www.cboe.com/tradable-products/vix/ or go to https://resources.carsongroup.com/hubfs/WMC-Source/2025/10-20-25-Yahoo-Finance-VIX-Data-Chart-3.pdf
4 https://www.barrons.com/articles/bank-stocks-buy-jamie-dimon-cockroach-f2374ee1?mod=hp_LEDE_C_1_B_1 or go to https://resources.carsongroup.com/hubfs/WMC-Source/2025/10-20-25-Barrons-Bank-Stocks-Get-Hit-By-Dimons-4.pdf
5 https://www.bloomberg.com/news/newsletters/2025-10-16/is-this-an-ai-bubble-then-where-are-the-short-sellers or go to https://resources.carsongroup.com/hubfs/WMC-Source/2025/10-20-25-Bloomberg-If-This-Is-An-AI-Bubble-5.pdf
6 https://www.bloomberg.com/news/articles/2025-10-16/stock-market-today-dow-s-p-live-updates?srnd=homepage-americas or go to https://resources.carsongroup.com/hubfs/WMC-Source/2025/10-20-25-Bloomberg-Stocks-Climb-As-Trump-Soothes-6.pdf
7 https://www.barrons.com/market-data?mod=BOL_TOPNAV or go to https://resources.carsongroup.com/hubfs/WMC-Source/2025/10-20-25-Barrons-DJIA-SP-NASDAQ-7.pdf
10 https://www.bloomberg.com/opinion/articles/2025-10-15/ai-effect-on-us-economy-is-exaggerated or go to https://resources.carsongroup.com/hubfs/WMC-Source/2025/10-20-25-Bloomberg-Three-Exaggerations-About-The-US-Economy-10.pdf
11 https://www.economist.com/finance-and-economics/2025/10/09/the-stockmarket-is-fuelling-americas-economy or go to https://resources.carsongroup.com/hubfs/WMC-Source/2025/10-20-25-The-Economist-The-Stock-Market-Is-Fueling-11.pdf
The Markets
Filling the data void.
Ancient Greek Philosopher Aristotle theorized that nature abhors a void and fills it.1 Anyone who has ever cleared a garden patch and delayed planting understands the idea. Before long, the empty ground is teeming with opportunistic plants.
The government shutdown created a data void. Usually, the government delivers robust economic data that analysts and investors rely on to better understand where the American economy has been, where it is now, and where it may be going. It’s information the United States Federal Reserve (Fed) relies on to determine whether a rate cut or increase is necessary, reported Megan Leonhardt of Barron’s.2
One critical piece of data that has been delayed because of the shutdown is the September 2025 unemployment report. With government data unavailable, Wall Street is turning to alternative sources of information—and those sources are telling different stories.2 For example, we’ve read that in September U.S. employment:
- Rebounded. A top financial firm reported “that the economy added about 80,000 jobs in September, showing a rebound from sluggish labor-market growth during the four preceding months,” according to Matt Grossman of Dow Jones via Barron’s.3
- Remained steady. The Chicago Federal Reserve’s Real-Time Unemployment Rate Forecast indicated that the unemployment rate remained unchanged at 4.3 percent for September.4
- Slowed. A global investment company reported, “…data from our portfolio suggest that the collapse in U.S. payroll employment growth continued in September, with monthly gains falling from an average of over 200,000 at the start of the year to just 15,000 over the past three months.”5
- Shrank. A top payroll processor found that “private employers shed 32,000 jobs in September.”6 It’s a finding that would be at odds with economists’ pre-shutdown forecasts, reported Leonhardt.2
The breakeven employment rate, which is the number of new jobs that must be created to keep the employment rate steady, is 32,000 to 82,000, according to the calculations of St. Louis Fed economists Alexander Bick and Victoria Gregory.7
Another critical piece of data is the Consumer Price Index (CPI), which measures how prices change from month to month. The October CPI is particularly important because it is used to calculate cost-of-living increases for Social Security recipients. The Social Security Administration is legally required to publish its annual cost-of-living increase for 2026 before November 1, reported Emily Peck of Axios. That’s why the Bureau of Labor Statistics began recalling employees last week The September CPI will be late, but it will be available in October.8
Last Friday, major U.S. stock indexes pulled back sharply after trade tensions reignited between the United States and China, reported Connor Smith of Barron’s.9 Yields on most maturities of U.S. Treasuries moved lower on Friday.10
Data as of 10/10/25 | 1-Week | YTD | 1-Year | 3-Year | 5-Year | 10-Year |
| Standard & Poor’s 500 Index | -2.4% | 11.4% | 13.4% | 22.0% | 13.1% | 12.5% |
| Dow Jones Global ex-U.S. Index | -1.5 | 22.9 | 15.8 | 17.2 | 6.6 | 5.0 |
| 10-year Treasury Note (yield only) | 4.1 | N/A | 4.1 | 3.9 | 0.8 | 2.1 |
| Gold (per ounce) | 2.3 | 52.2 | 51.2 | 33.33 | 15.6 | 13.1 |
| Bloomberg Commodity Index | -1.2 | 5.4 | 3.5 | -3.6 | 7.4 | 1.5 |
S&P 500, Dow Jones Global ex-US, Gold, Bloomberg Commodity Index returns exclude reinvested dividends (gold does not pay a dividend) and the three-, five-, and 10-year returns are annualized; and the 10-year Treasury Note is simply the yield at the close of the day on each of the historical time periods.
Sources: Yahoo! Finance; MarketWatch; djindexes.com; U.S. Treasury; London Bullion Market Association.
Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly. N/A means not applicable.
A ROOM OF ONE’S OWN. Housing is expensive. Buying a home is out of reach for many Americans because “home prices are historically high relative to incomes”, reported Peyton Whitney of the Joint Center for Housing Studies at Harvard. In 2024, the price of a median single-family home was five times the median household income. (Affordability of homes varies by region.)11
Renting isn’t cheap either. The Economist analyzed the affordability of American cities for renters who prefer to live alone. They used “…the rule that a tenant should spend no more than 30% of their gross income on rent. Using rental prices gathered by…an online property platform, we calculated the salary needed to afford a typical studio apartment in each city.”12
Based on median rental prices for August 2025, the publication found the most affordable cities in the United States included: 12
- Wichita, Kansas
- Baton Rouge, Louisiana
- Lincoln, Nebraska
The report found that some previously unaffordable cities have become affordable, including Knoxville, Tennessee; Denver, Colorado; Madison, Wisconsin; and Norfolk, Virginia.12
Then, there are the cities that are affordable only if a renter earns a well-above-average income. The least affordable cities for renters hoping to live alone included:12
- New York City, New York
- Miami, Florida
- Jersey City, New Jersey
In addition, “Several of the newly prohibitive cities are in Texas…Last year, both Houston and Dallas were deemed affordable…This year, they fell below that threshold. In Austin, monthly studio rents are now $1,580, a 25% jump from 2024. This requires a salary of $63,200, more than $10,000 higher than the city’s median wage…Texas has experienced an influx of people in recent years. Many tech firms and other big companies have moved their offices to the state, drawn by low taxes and favorable regulation. Salaries have increased, but rents are rising faster,” reported The Economist.12
WEEKLY FOCUS – THINK ABOUT IT
“The ache for home lives in all of us. The safe place where we can go as we are and not be questioned.”13
–Maya Angelou, Memoirist and poet
* These views are those of Carson Coaching, not the presenting Representative, the Representative’s Broker/Dealer, or Registered Investment Advisor, and should not be construed as investment advice.
* This newsletter was prepared by Carson Coaching. Carson Coaching is not affiliated with the named firm or broker/dealer.
* Government bonds and Treasury Bills are guaranteed by the U.S. government as to the timely payment of principal and interest and, if held to maturity, offer a fixed rate of return and fixed principal value. However, the value of fund shares is not guaranteed and will fluctuate.
* Corporate bonds are considered higher risk than government bonds but normally offer a higher yield and are subject to market, interest rate and credit risk as well as additional risks based on the quality of issuer coupon rate, price, yield, maturity, and redemption features.
* The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. You cannot invest directly in this index.
* All indexes referenced are unmanaged. The volatility of indexes could be materially different from that of a client’s portfolio. Unmanaged index returns do not reflect fees, expenses, or sales charges. Index performance is not indicative of the performance of any investment. You cannot invest directly in an index.
* The Dow Jones Global ex-U.S. Index covers approximately 95% of the market capitalization of the 45 developed and emerging countries included in the Index.
* The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
* Gold represents the 3:00 p.m. (London time) gold price as reported by the London Bullion Market Association and is expressed in U.S. Dollars per fine troy ounce. The source for gold data is Federal Reserve Bank of St. Louis (FRED), https://fred.stlouisfed.org/series/GOLDPMGBD228NLBM.
* The Bloomberg Commodity Index is designed to be a highly liquid and diversified benchmark for the commodity futures market. The Index is composed of futures contracts on 19 physical commodities and was launched on July 14, 1998.
* The Dow Jones Industrial Average (DJIA), commonly known as “The Dow,” is an index representing 30 stock of companies maintained and reviewed by the editors of The Wall Street Journal.
* The NASDAQ Composite is an unmanaged index of securities traded on the NASDAQ system.
* International investing involves special risks such as currency fluctuation and political instability and may not be suitable for all investors. These risks are often heightened for investments in emerging markets.
* Yahoo! Finance is the source for any reference to the performance of an index between two specific periods.
* The risk of loss in trading commodities and futures can be substantial. You should therefore carefully consider whether such trading is suitable for you in light of your financial condition. The high degree of leverage is often obtainable in commodity trading and can work against you as well as for you. The use of leverage can lead to large losses as well as gains.
* Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
* Economic forecasts set forth may not develop as predicted and there can be no guarantee that strategies promoted will be successful.
* Past performance does not guarantee future results. Investing involves risk, including loss of principal.
* The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee it is accurate or complete.
* There is no guarantee a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.
* Asset allocation does not ensure a profit or protect against a loss.
* Consult your financial professional before making any investment decision.
Sources:
1 https://en.wikipedia.org/wiki/Horror_vacui_(philosophy)
2 https://www.barrons.com/articles/shutdown-muddles-the-jobs-picture-for-economists-fed-48f547ce or go to https://resources.carsongroup.com/hubfs/WMC-Source/2025/10-13-25-Barrons-Shutdown-Muddles-The-Job-2.pdf
3 https://www.barrons.com/livecoverage/stock-market-news-today-100625/card/missing-september-economy-stats-seen-as-benign-4WjOev2GisJEdq7U5R3Z?mod=Searchresults or go to https://resources.carsongroup.com/hubfs/WMC-Source/2025/10-13-25-Barrons-Missing-September-Economy-3.pdf
4 https://www.chicagofed.org/research/data/chicago-fed-labor-market-indicators/latest-release
5 https://www.carlyle.com/carlyle-compass/out-left-field-labor-market
6 https://adpemploymentreport.com
8 https://www.axios.com/2025/10/10/shutdown-monthly-inflation-report-social-security or go to https://resources.carsongroup.com/hubfs/WMC-Source/2025/10-13-25-Axios-Why-The-Shutdown-Isnt-Stopping-8.pdf
9 https://www.barrons.com/livecoverage/stock-market-news-today-101025?modCode=hp_LEDE_C_LC or go to https://resources.carsongroup.com/hubfs/WMC-Source/2025/10-13-25-Barrons-NASDAQ-Sinks-3.6%25-9.pdf
11 https://www.jchs.harvard.edu/blog/home-prices-surge-five-times-median-income-nearing-historic-highs
12 https://www.economist.com/graphic-detail/2025/09/30/where-can-americans-afford-to-live-solo-in-2025 or go to https://resources.carsongroup.com/hubfs/WMC-Source/2025/10-13-25-The-Economist-Where-Can-Americans-Afford-12.pdf
The Markets
It was a stellar quarter for investors.
The last three months have delivered stock market gains amid signs the economy might not be doing as well as previously thought. Here’s what we saw:
Stock markets advanced
Solid corporate earnings growth, enthusiasm for artificial intelligence (AI), and expectations for a Federal Reserve (Fed) rate cut helped drive stock markets in the United States higher during the third quarter of 2025.1
“The broad U.S. equity indices were higher across the board in both September and Q3. For the S&P [Standard & Poor’s] 500 and Nasdaq-100, September marked their 5th and 6th consecutive monthly gains, respectively. And for the S&P 500, this was its 2nd best September…in 27 years,” reported the Nasdaq Market Intelligence Desk Team.2
Stock valuations moved higher
The downside of recent stock market performance is that valuations have reached lofty levels. As a result, investors are paying “the most for future earnings in more than two decades, adding a new element of risk to the market’s rally,” reported Martin Baccardax of Barron’s.3 The risk is that earnings may not meet investors’ expectations, which could lead to lower stock prices.
Questions rose about the strength of the economy
Economic data is usually revised several times before the final numbers arrive. In September, the employment report revision showed 911,000 fewer jobs may have been created over the past twelve months than previously thought.4 The change raised questions about the strength of the economy – and the quality and collection of data for the report, reported Jeff Cox of CNBC.5
“The revisions were more than 50% higher than last year’s adjustment and the largest on record going back to 2002. On a monthly basis, they suggest average job growth of 76,000 less than initially reported.”5
The Fed lowered the federal funds rate
Investors have been anticipating a Fed rate cut for some time. In September, the Fed’s concerns about inflation were offset by data suggesting the U.S. labor market is softening rapidly, and the Fed lowered the federal funds rate by one-quarter percentage point.6
While investors expect more rate cuts this year, it’s unclear whether that will happen. “At the center of the tension are rising prices. While inflation has slowed from its pandemic highs, it remains above the Fed’s 2% target. Several regional Fed presidents cautioned on Monday that policymakers shouldn’t move too quickly to ease policy, even as investors and Wall Street analysts bet on more cuts,” reported Nicole Goodkind of Barron’s.7
Consumer sentiment moved lower, too
While investors had a lot to celebrate in the third quarter, consumers’ optimism faded in August and September. The University of Michigan’s Consumer Sentiment Index showed that sentiment was down about five percent month over month in September, and more than 21 percent year over year.8
“Although September’s decline was relatively modest, it was still seen across a broad swath of the population, across groups by age, income, and education, and all five index components. A key exception: sentiment for consumers with larger stock holdings held steady in September, while for those with smaller or no holdings, sentiment decreased,” reported Surveys of Consumers Director Joanne Hsu.8
The fourth quarter began with a government shutdown. The closure had little effect on market optimism, and major U.S. stock indexes moved higher last week.1 Yields on U.S. Treasuries generally dipped lower or remained steady over the week.9
Data as of 10/3/25 | 1-Week | YTD | 1-Year | 3-Year | 5-Year | 10-Year |
| Standard & Poor’s 500 Index | 1.1% | 14.2% | 17.8% | 23.4% | 14.5% | 13.0% |
| Dow Jones Global ex-U.S. Index | 2.7 | 24.8 | 16.7 | 17.7 | 7.5 | 5.5 |
| 10-year Treasury Note (yield only) | 4.1 | N/A | 3.9 | 3.7 | 0.8 | 2.1 |
| Gold (per ounce) | 3.1 | 48.8 | 46.8 | 32.6 | 15.3 | 13.1 |
| Bloomberg Commodity Index | 0.2 | 6.7 | 3.0 | -2.2 | 8.2 | 1.7 |
S&P 500, Dow Jones Global ex-US, Gold, Bloomberg Commodity Index returns exclude reinvested dividends (gold does not pay a dividend) and the three-, five-, and 10-year returns are annualized; and the 10-year Treasury Note is simply the yield at the close of the day on each of the historical time periods.
Sources: Yahoo! Finance; MarketWatch; djindexes.com; U.S. Treasury; London Bullion Market Association.
Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly. N/A means not applicable.
WHAT DOES A GOVERNMENT SHUTDOWN MEAN FOR INVESTORS? Last week, the U.S. government closed after Congress failed to pass a temporary funding measure to keep it open. The sticking point appeared to be whether the government should continue to provide tax credits to offset the cost of healthcare premiums under the Affordable Care Act, reported Anita Hamilton of Barron’s. The credits are scheduled to expire at the end of 2025.10
Historically, government shutdowns have had little impact on financial markets. However, some analysts believe this shutdown may create additional financial market volatility. The good news is, when markets are negatively affected, they tend to recover quickly, reported Callum Keown of Barron’s. In any case, investors should be aware of shorter-term risks, including:11
- Delayed Initial Public Offerings (IPOs). When a private company raises capital by selling shares to the public for the first time, it is called an IPO. “With the Securities and Exchange Commission running only essential functions on a skeleton staff, the agency will stop processing IPO paperwork, leaving companies primed for Wall Street debuts…in limbo,” reported Manya Saini and Niket Nishant of Reuters.12
- Delayed drug approvals. The U.S. Food and Drug Administration (FDA) will continue to review current product applications during the shutdown; however, it has stopped accepting new applications, reported Kristin Jensen of Biopharma Dive.13 The FDA is funded through user fees, which it cannot collect when the government is closed, reported Josh Nathan-Kazis of Barron’s. That could create issues if the shutdown lasts for a significant period.14
- Challenges for federal contractors. The shutdown affects U.S. government employees – and everyone employed by a government contractor. “While some federal contracts will stop work in the event of a shutdown, others will continue on, particularly if they’re funded by appropriations from past fiscal years…however, problems emerge when contractors need an action by or information from a federal employee who is furloughed,” reported Sean Michael Newhouse of Government Executive. If the administration decides to layoff government employees, the issue could become more complicated.15
- Lack of economic data. The Bureau of Labor Statistics, Bureau of Economic Analysis and Census Bureau stop collecting and distributing data when the government shuts down. As a result, the shutdown “will shut off the flow of key economic data at a moment of uncertainty among policymakers and investors about the health of the U.S. job market, the trajectory of inflation and the strength of consumer spending and business investment,” reported Reuters.16
The overall effect of the shutdown will depend on how long it lasts.
WEEKLY FOCUS – THINK ABOUT IT
“I don’t think that you can be an extraordinary leader unless you love your people sincerely. Now history shows us that you can win battles, you can accomplish missions, you can build buildings, and you can win games without loving your people, because a lot of people have done it that way. But I am convinced that you and your organization, your unit, your group will never be extraordinary in the long run without…genuine concern for your people.”17 – Colonel Arthur J. Athens, United States Marine Corps Reserve (Retired)
* These views are those of Carson Coaching, not the presenting Representative, the Representative’s Broker/Dealer, or Registered Investment Advisor, and should not be construed as investment advice.
* This newsletter was prepared by Carson Coaching. Carson Coaching is not affiliated with the named firm or broker/dealer.
* Government bonds and Treasury Bills are guaranteed by the U.S. government as to the timely payment of principal and interest and, if held to maturity, offer a fixed rate of return and fixed principal value. However, the value of fund shares is not guaranteed and will fluctuate.
* Corporate bonds are considered higher risk than government bonds but normally offer a higher yield and are subject to market, interest rate and credit risk as well as additional risks based on the quality of issuer coupon rate, price, yield, maturity, and redemption features.
* The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. You cannot invest directly in this index.
* All indexes referenced are unmanaged. The volatility of indexes could be materially different from that of a client’s portfolio. Unmanaged index returns do not reflect fees, expenses, or sales charges. Index performance is not indicative of the performance of any investment. You cannot invest directly in an index.
* The Dow Jones Global ex-U.S. Index covers approximately 95% of the market capitalization of the 45 developed and emerging countries included in the Index.
* The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
* Gold represents the 3:00 p.m. (London time) gold price as reported by the London Bullion Market Association and is expressed in U.S. Dollars per fine troy ounce. The source for gold data is Federal Reserve Bank of St. Louis (FRED), https://fred.stlouisfed.org/series/GOLDPMGBD228NLBM.
* The Bloomberg Commodity Index is designed to be a highly liquid and diversified benchmark for the commodity futures market. The Index is composed of futures contracts on 19 physical commodities and was launched on July 14, 1998.
* The Dow Jones Industrial Average (DJIA), commonly known as “The Dow,” is an index representing 30 stock of companies maintained and reviewed by the editors of The Wall Street Journal.
* The NASDAQ Composite is an unmanaged index of securities traded on the NASDAQ system.
* International investing involves special risks such as currency fluctuation and political instability and may not be suitable for all investors. These risks are often heightened for investments in emerging markets.
* Yahoo! Finance is the source for any reference to the performance of an index between two specific periods.
* The risk of loss in trading commodities and futures can be substantial. You should therefore carefully consider whether such trading is suitable for you in light of your financial condition. The high degree of leverage is often obtainable in commodity trading and can work against you as well as for you. The use of leverage can lead to large losses as well as gains.
* Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
* Economic forecasts set forth may not develop as predicted and there can be no guarantee that strategies promoted will be successful.
* Past performance does not guarantee future results. Investing involves risk, including loss of principal.
* The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee it is accurate or complete.
* There is no guarantee a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.
* Asset allocation does not ensure a profit or protect against a loss.
* Consult your financial professional before making any investment decision.
Sources:
1 https://www.barrons.com/market-data?mod=BOL_TOPNAV or go to https://resources.carsongroup.com/hubfs/WMC-Source/2025/10-06-25-Barrons-DJIA-SP-NASDAQ-1.pdf
2 https://www.nasdaq.com/articles/september-third-quarter-2025-review-and-outlook
3 https://www.barrons.com/articles/stock-market-sp500-overvalued-inflation-jobs-earnings-5f24cda6 or go to https://resources.carsongroup.com/hubfs/WMC-Source/2025/10-06-25-Barrons-Is-The-Stock-Market-Overvalued-3.pdf
4 https://www.bls.gov/news.release/prebmk.nr0.htm
5 https://www.cnbc.com/2025/09/09/jobs-report-revisions-september-2025-.html
6 https://www.federalreserve.gov/newsevents/pressreleases/monetary20250917a.htm
7 https://www.barrons.com/articles/the-federal-reserve-rates-inflation-market-c8c19bab or go to https://resources.carsongroup.com/hubfs/WMC-Source/2025/10-06-25-Barrons-The-Market-Is-Betting-7.pdf
8 https://www.sca.isr.umich.edu or go to https://resources.carsongroup.com/hubfs/WMC-Source/2025/10-06-25-Survey-of-Consumers-University-of-Michigan-8.pdf
10 https://www.barrons.com/livecoverage/shutdown-government-news/card/marketplace-health-plan-costs-will-rise-114-if-subsidies-expire-kff-qfCUxwyDDjhHTp8RJL2w?mod=hp_LEDE_C_1_B_4 or go to https://resources.carsongroup.com/hubfs/WMC-Source/2025/10-06-25-Barrons-Marketplace-Health-Plan-Costs-10.pdf
11 https://www.barrons.com/livecoverage/shutdown-government-news/card/delays-to-ipos-drug-approvals-jobs-data-and-more-impacts-of-a-longer-shutdown-D8BVvUg1MYK4EkYtOkIj?mod=hp_LEDE_C_1_B_1 or go to https://resources.carsongroup.com/hubfs/WMC-Source/2025/10-06-25-Barrons-Delay-To-IPOs-Drug-Approvals-11.pdf
13 https://www.biopharmadive.com/news/fda-government-shutdown-new-drug-applications-reviews/761576/
14 https://www.barrons.com/livecoverage/shutdown-government-news/card/fda-won-t-be-significantly-disrupted-by-a-short-shutdown-0MhUBQLiCMWcj6wYhHCf or go to https://resources.carsongroup.com/hubfs/WMC-Source/2025/10-06-25-Barrons-FDA-Wont-Be-Significantly-14.pdf
17 https://www.usmcu.edu/Portals/218/Art%20Athens%20speech.pdf
The Markets
The economy is all right.
Last week, revised economic figures showed the United States economy grew faster from April through June than previously thought. The upward revision was primarily due to a revised estimate for consumer spending over the period, according to Connor Smith of Barron’s.1
“American consumers, the engine of the world’s largest economy, have remained resilient in the face of tariffs and economic uncertainty…The continued strength in spending, which has defied worries about a slowdown, is in contrast to recent data showing a weakening labor market…But initial claims for unemployment insurance fell last week to their lowest level since July…in a sign that the jobs market might not be in as dire shape as other data have suggested,” reported Danielle Kay of the BBC.2
The contrast between consumer spending and consumer sentiment was striking. Consumer sentiment moved lower again in September and is down more than 21 percent this year, according to the University of Michigan’s Consumer Sentiment Survey.3
“Nationally, not only did macroeconomic expectations fall, particularly for labor markets and business conditions, but personal expectations did as well, with a softening outlook for [consumers’] own incomes and personal finances. Consumers continue to express frustration over the persistence of high prices, with 44% spontaneously mentioning that high prices are eroding their personal finances, the highest reading in a year,” wrote Surveys of Consumers Director Joanne Hsu.3
The inflation picture did not improve in August. Prices, as measured by the personal consumption expenditures price index, were up 2.7 percent year over year. When volatile food and energy prices were excluded, prices rose 2.9 percent year over year.4 Both measures are well above the Federal Reserve’s two percent inflation target.5
Last week, major U.S. stock indexes rallied on Friday, but were not able to recoup losses from earlier in the week, reported Sean Conlon of CNBC.6 Yields moved higher over the week for all but the longest maturities of U.S. Treasuries.7
Data as of 9/26/25 | 1-Week | YTD | 1-Year | 3-Year | 5-Year | 10-Year |
| Standard & Poor’s 500 Index | 1.2% | 13.3% | 16.6% | 19.7% | 15.2% | 13.0% |
| Dow Jones Global ex-U.S. Index | 0.4 | 22.6 | 16.3 | 14.5 | 7.3 | 5.3 |
| 10-year Treasury Note (yield only) | 4.1 | N/A | 3.7 | 3.5 | 0.7 | 2.2 |
| Gold (per ounce) | 0.3 | 40.3 | 42.2 | 30.1 | 13.9 | 12.5 |
| Bloomberg Commodity Index | -0.8 | 4.3 | 5.2 | -4.1 | 7.7 | 1.5 |
S&P 500, Dow Jones Global ex-US, Gold, Bloomberg Commodity Index returns exclude reinvested dividends (gold does not pay a dividend) and the three-, five-, and 10-year returns are annualized; and the 10-year Treasury Note is simply the yield at the close of the day on each of the historical time periods.
Sources: Yahoo! Finance; MarketWatch; djindexes.com; U.S. Treasury; London Bullion Market Association.
Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly. N/A means not applicable.
IT’S NOT THE NOBEL PRIZE. “Many scientists dream of winning a Nobel Prize, an accolade that brings worldwide recognition, prestige and a place in the pantheon of greatness alongside the likes of Albert Einstein, Marie Curie and Francis Crick. Then there are the other awards — the Ig Nobel prizes, which were devised to highlight research that makes people laugh, then think,” reported Chris Simms in the journal Nature.8
The 35th First Annual Ig Nobel Prize ceremony took place in mid-September. This year’s awards included:9
- Peace Prize. Fritz Renner, Inge Kersbergen, Matt Field, and Jessica Werthmann were recognized for investigating the effects of alcohol consumption on foreign language pronunciation among people who have just learned a language. Turns out, having a few drinks improves the foreign language skills of some people – but not their ability to self-rate their skills. The data were published in Dutch Courage? Effects of Acute Alcohol Consumption on Self-Ratings and Observer Ratings of Foreign Language Skills.9,10
- Biology Prize. “Biting flies are the most damaging arthropod pests of cattle worldwide and the economic impact of biting flies on the United States cattle production was estimated at [$2.211 billion] per year,” according to a team of researchers in Japan who studied ways to address the issue. They found that disguising cows as zebras – by painting them with black and white stripes – greatly reduced the number of fly bites.9,11
- Engineering Design Prize. Vikash Kumar and Sarthak Mittal took home an Ig for their paper titled, Smelly Shoes – An Opportunity for Shoe Rack Re-Design. The pair explored how stinky shoes affect owner satisfaction with shoe racks in India. They concluded there is market potential for a new type of device with a built-in deodorizer.9,12
- Physics Prize. Cacio e pepe is one of those deceptively simple Italian sauces that can be quite challenging to prepare. Researchers from Spain, Italy, Germany, and Austria studied the cooking process to develop a scientific recipe. They explained, “A true Italian grandmother or a skilled home chef from Rome would never need a scientific recipe for Cacio e pepe, relying instead on instinct and years of experience. For everyone else, this guide offers a practical way to master the dish.”The recipe can be found in the paper, Phase behavior of Cacio e pepe sauce.9,13
Prizes also were awarded in the fields of literature, psychology, nutrition, pediatrics, chemistry, and aviation.
WEEKLY FOCUS – THINK ABOUT IT
“The ‘silly’ question is the first intimation of some totally new development.”14–Alfred Whitehead, Mathematician and philosopher
* These views are those of Carson Coaching, not the presenting Representative, the Representative’s Broker/Dealer, or Registered Investment Advisor, and should not be construed as investment advice.
* This newsletter was prepared by Carson Coaching. Carson Coaching is not affiliated with the named firm or broker/dealer.
* Government bonds and Treasury Bills are guaranteed by the U.S. government as to the timely payment of principal and interest and, if held to maturity, offer a fixed rate of return and fixed principal value. However, the value of fund shares is not guaranteed and will fluctuate.
* Corporate bonds are considered higher risk than government bonds but normally offer a higher yield and are subject to market, interest rate and credit risk as well as additional risks based on the quality of issuer coupon rate, price, yield, maturity, and redemption features.
* The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. You cannot invest directly in this index.
* All indexes referenced are unmanaged. The volatility of indexes could be materially different from that of a client’s portfolio. Unmanaged index returns do not reflect fees, expenses, or sales charges. Index performance is not indicative of the performance of any investment. You cannot invest directly in an index.
* The Dow Jones Global ex-U.S. Index covers approximately 95% of the market capitalization of the 45 developed and emerging countries included in the Index.
* The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
* Gold represents the 3:00 p.m. (London time) gold price as reported by the London Bullion Market Association and is expressed in U.S. Dollars per fine troy ounce. The source for gold data is Federal Reserve Bank of St. Louis (FRED), https://fred.stlouisfed.org/series/GOLDPMGBD228NLBM.
* The Bloomberg Commodity Index is designed to be a highly liquid and diversified benchmark for the commodity futures market. The Index is composed of futures contracts on 19 physical commodities and was launched on July 14, 1998.
* The Dow Jones Industrial Average (DJIA), commonly known as “The Dow,” is an index representing 30 stock of companies maintained and reviewed by the editors of The Wall Street Journal.
* The NASDAQ Composite is an unmanaged index of securities traded on the NASDAQ system.
* International investing involves special risks such as currency fluctuation and political instability and may not be suitable for all investors. These risks are often heightened for investments in emerging markets.
* Yahoo! Finance is the source for any reference to the performance of an index between two specific periods.
* The risk of loss in trading commodities and futures can be substantial. You should therefore carefully consider whether such trading is suitable for you in light of your financial condition. The high degree of leverage is often obtainable in commodity trading and can work against you as well as for you. The use of leverage can lead to large losses as well as gains.
* Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
* Economic forecasts set forth may not develop as predicted and there can be no guarantee that strategies promoted will be successful.
* Past performance does not guarantee future results. Investing involves risk, including loss of principal.
* The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee it is accurate or complete.
* There is no guarantee a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.
* Asset allocation does not ensure a profit or protect against a loss. * Consult your financial professional before making any investment decision.
Sources:
1 https://www.barrons.com/livecoverage/stock-market-news-today-092525/card/stocks-drop-for-third-straight-day-despite-upbeat-economic-data-7ZI68Vfc4Tr13YOsRiNH?mod=Searchresults or go to https://resources.carsongroup.com/hubfs/WMC-Source/2025/09-29-25-Barrons-Stock-Drop-For-Third-Straight-Day-1.pdf
2 https://www.bbc.com/news/articles/cjedze7e95lo
3 https://www.sca.isr.umich.edu
4 https://www.bea.gov/sites/default/files/2025-09/pi0825.pdf [Table 7]
5 https://www.federalreserve.gov/economy-at-a-glance-inflation-pce.htm
6 https://www.cnbc.com/2025/09/25/stock-market-today-live-updates.html#
8 https://www.nature.com/articles/d41586-025-03045-0
9 https://improbable.com/ig/winners/#ig2025
10 https://journals.sagepub.com/doi/10.1177/0269881117735687
11 https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0223447
13 https://pubs.aip.org/aip/pof/article/37/4/044122/3345324/Phase-behavior-of-Cacio-e-Pepe-sauce 14https://www.goodreads.com/quotes/tag/silly?page=2