Daybreak with Anton

Before the war with Iran, both investors and consumers were already facing significant uncertainty about the outlook for their finances and the broader U.S. economy. Investors were focused on several key issues, including the future path of Federal Reserve interest rates, the appointment of a new Federal Reserve Chair, rising inflation, and the potential effects of tariffs. Consumers, meanwhile, had their own set of concerns. These included persistently high mortgage rates, a sluggish housing market, the rising cost of living, and worries about job security particularly considering increasing AI-related disruption. However, consumers are experiencing a greater level of anxiety than business owners. Listen to this UPdate recent sentiment reports for business owners and consumers and our forecasts for the stock market in 2026.

On June 12–13 of last year, Israel carried out large-scale airstrikes against Iran, targeting nuclear facilities, military bases, and senior commanders and scientists. Dozens of sites were neutralized, and several top Iranian military leaders were killed. Despite the escalation, U.S. institutional investors showed little concern and continued deploying billions into equities, private equity, and venture capital. Markets responded positively, with both the S&P 500 and NASDAQ reaching new all-time highs.

As a lifelong investor and portfolio manager for the past 28 years, I can confidently say the stock market has bipolar disorder. In reality, it is the large cast of participants that include media commentators, analysts, institutional investors, and everyday individuals who drive the market's unpredictable day-to-day movements. Read in this UPdate our analysis of the stock market, the impact of AI, and our views for the balance of this year.

Over the past three days, we've received reports on the state of consumer sentiment and small business confidence. The results show that both groups are slowly becoming more optimistic about the future, though improvement remains modest. Read in this UPdate, our review of several reports concerning consumer and small business sentiment and our views for the stock market.

Several years ago, Simon Maierhofer, editor, and founder of iSpy ETF Newsletter, introduced me to a combination of three barometers that have had interesting results in predicting the future S&P 500 performance of the new year. These three barometers are monitoring the performance of the S&P 500 during specific days of the prior year December Christmas and the new year. These three periods make up what is known as the "Santa Claus Barometer". The specific days for this Santa Claus barometer are: Ø Santa Claus Rally (SCR) – Prior Year December 26 to 31 Ø First Five Days of Current Year January (F5D) Ø Current Year January Barometer (Jan) Listen to this UPdate the final tally of these three periods and what it may predict for 2026. We also review the state of the US stock market and significant volatility that continued in 2026.

Last year, we began adding gold and silver mining companies Up Capital Model portfolios. Let me first give credit to client, Annie Alexander, who first introduced the idea of miner stocks early in 2025 as a developing favorable asset class. We ultimately decided to add gold and silver miners to Up Capital Model portfolios in the second quarter of 2025. Listen to this UPdate our analysis of the precious metals and miners and the potential for continued gains in 2026.

The year has now begun with a jolt of geopolitical disruption from Washington. Over the weekend, following months of negotiations with Venezuelan President Nicolás Maduro, President Trump authorized a dramatic 2:00 a.m. local-time operation by elite U.S. Delta Force units. The mission captured President Maduro and his wife and transported them to the United States, where they now await trial. Read in this UPdate our view of these recent events and the potential impact on the oil industry.

The predictability of investor behavior can feel almost tedious to anyone who closely follows market activity. Major U.S. indices are wrapping up a third consecutive calendar year of double-digit annual gains, with the S&P 500 up 76.52% and the NASDAQ soaring 119.4% since January 1, 2022. Hopefully, relentless negative messaging from the major media outlets did not keep you on the sidelines and prevent you from participating in these solid gains over the past three years. Listen to this UPdate our view of the AI boom, the recent market pause, and investor temperament.

As an investment advisor, I've had the privilege of working with clients across the full wealth spectrum from the ultra-affluent to those of more modest means. After more than 35 years in this profession, one truth has become unmistakably clear: wealth has its limits. In this UPdate, you'll read examples of clients who not only achieved financial success but also made intentional sacrifices to uphold personal standards they refused to compromise.

Last weekend, our friends and clients, Justin and Kelli Blackburn, invited us to attend the formal annual dinner benefiting St Jude Children's Research Hospital. Justin and Kelli are the founders of Trinity Constructors, a leading commercial construction company with offices in Texas, Tennessee, and Colorado. Listen to this UPdate our experience attending this dinner event and the impact this organization has had on Justin and Kelli.

Today marks the release of the 2nd Edition of Physicians' Guide to Wealth on Amazon. And despite its title, this book is not just for doctors. It's for anyone who wants to build wealth, understand financial markets, and achieve financial independence. In this UPdate, we outline key topics in this book that includes an overview of Anton's research on repeating and unbroken economic cycles of growth and contraction.

Engineers have a remarkable talent for inventing solutions to problems most people didn't even know existed. Consider the humble public restroom. For decades, we managed perfectly well with the trusty twisty-knob faucet—left for hot, right for cold. Simple. Functional. Civilized. Now, in this UPdate, we take a look at businesses pouring millions—and in some cases, billions—into AI, often with no clear plan for how that investment will actually deliver returns.

If you missed the market rotation mid last year to gold and precious metal miners, you may be asking if it's too late to jump on? We started adding gold and silver miners in the first quarter of this year. Gold has become another key asset for our portfolios to diversify our very profitable positions in AI and technology. Listen to this UPdate our analysis of the AI boom and the precious metal rally that began in early 2024 with forecasts of how much longer these trends may continue.

Investors are enjoying a robust stock market rally with NASDAQ and possibly the S&P 500 completing three consecutive years of 20%+ annual gains. Meanwhile, Berkshire Hathaway has amassed a record-breaking cash reserve, reaching an all-time high of $347.7 billion in the first quarter of 2025. This represents more than a threefold increase in just three years, driven largely by aggressive stock sales and what their investment committee led by Warren Buffet perceives as a lack of attractive investment opportunities. Listen to this UPdate our analysis of multiple stock market warnings and our views of the stock for the balance of 2025 and into 2026.

Small business owners have endured a difficult four years. Before the global COVID-19 pandemic, many were benefiting from economic growth between 2017 and 2020. But when the pandemic struck, supply chains became strained and inflationary pressures intensified, even as consumer behavior shifted and work moved largely into people's homes. Consequently, the small business optimism index by the National Federation of Independent Businesses (NFIB) plunged in early 2020 to its lowest reading in four decades. In this UPdate, we analyze the latest NFIB optimism figures and explore what they might mean for investing in small- and mid-cap sectors going forward.

My selection of reports to write about is getting narrowed as multiple reporting US Federal agencies have stopped releasing economic data due to the Federal government shutdown. However, just before the government shutdown, the Federal Housing Finance Agency, (FHFA) released their housing price index for July based on home purchases with mortgages financed or bundled by federal housing agencies. Listen to 4this UPdate our analysis of the housing market and potential impact on the stock market.

Last week we reviewed the changes in prices from manufacturers and producers. Based on the reports from the US Bureau of Labor Statistics, the annual increase of the Producer Price Index (PPI) declined in August to 2.6% Year over Year (YoY) compared to July's YoY annualized rate of 3.06%. Today, we will look further into the supply chain processes at cost changes of imports to our US producers. We will also look at export costs to our foreign partners as the changes will eventually impact US companies. First, we will look at the import costs that will have a direct impact on the US inflation and consumer price index. The US Bureau of Labor Statistics released this morning the US Import Price changes of their index. The index increased 0.3% to 141.4 points in August but the index is down from the start of the year at 141.8.

To determine the future costs of consumer goods one needs to monitor the costs to producers. If producer costs go up then it is only a matter of time until your costs increase at the retail level. Read in this UPdate our reporting on the changes of Producer Price Index (PPI) and Consumer Price Index (CPI) and what impact tariffs may be playing in future price increases.

Many of you read about the tragedy in the small town of Hunt in the Texas Hill Country. Torrential rain poured from July 4th to the 7th and then resumed again July 12 -13. The Guadalupe River that runs around the town quickly rose with water levels rising over 30' in the town of Hunt. By the time water levels finally receded, 132 fatalities were confirmed including 27 children attending Camp Mystic, a girl's camp, located along the Guadalupe River. Listen in this UPdate, Anton's experience volunteering in Hunt this past weekend.

After the Federal Reserve raised their discount rate 500% in 2022 and 2023 taking mortgage rates up with them, housing activity has hit a brick wall. Since mid-2023, prospective home buyers have remained on the sidelines happy to remain with their current home or as renters. Listen in this UPdate our analysis of the housing market, its impact on the stock market, and our projections for the balance of this year.

There is a widening range of sentiments between individuals and business owners. The question is who is right and is perception reality? As we have mentioned in past Updates, consumers have only been this dire about the economy and their financial future in three other periods since 1978. Listen in this UPdate, our observations of the sentiment of these two sectors of the economy and the potential impact on the economy.

My grandson, Anton the 5th, and I flew our Piper Cherokee laterally across the country from southern Texas to the Annual AirVenture event in Oshkosh, Wisconsin earlier this month. Flying through the mid-west during the summer is always a challenge with pop-up thunderstorms, tornadoes, rain, and low cloud ceilings. The economy is starting to also show new signs of potential turbulence. Listen in this Weekly UPdate our assessment of the economy and stock market and how you might consider navigation through possible turbulent market conditions.

AI has exploded onto the scene led by supercomputing chips by Nvidia (NVDA). Initially, CEO's and CTO's (Chief Technology Officer) were evaluating the potential of this new highly advanced self-learning technology. When introduced, the application of AI was limited to basic business functionality primarily with phone systems. Read in this UPdate our review of how AI may be affecting you and where new investing opportunities may be developing.

Today the US Bureau of Labor Statistics announced the Consumer Price Index (CPI) for the month of June had increased to 322.56 points or 0.3%. On an annual basis, the annual inflation rate has increased to 2.7% which is the highest annualized rate since February's low reading of 2.4% annualized rate. Listen in this Weekly UPdate our analysis of this report and the status of the US economy and stock market.

The rapid rise of interest rates causes significant changes in lending activity and especially in the housing mortgage market. According to CNBC, the sale of previously owned homes in April declined 0.5% from March to an annualized rate of 4 million units. This is the slowest April pace since 2009. Read in this issue our view of the future of interest rates and inflation and the possible impact on the stock market.

In the complex and extensive ecosystem of the US economy, the fundamental core of its sustainability and continued growth all depends on the consumer. That's you and me and how we spend and save our money. As investors we monitor consumer spending of both staples as the largest portion of household budgets and the more profitable discretionary spending such as vacations, hospitality, dining, jewelry, and luxury items. Discretionary budgets can fluctuate dramatically that are influenced by various factors that include changes in payroll, consumer sentiment, media, inflation, and politics. What is interesting is the widening spread of sentiment between business owners and consumers. In this Issue we discuss the wide gap of sentiment between business owners and consumers and what it means to you. Most importantly, how this disparity may influence the stock market and your investments.

For many of our retired clients, they had successful careers and are now enjoying their retirement years. Stock market volatility is difficult to navigate for investors and even more challenging for those already retired. The difference between those retired from their careers is the ability or time to make up account losses. It is more difficult to ride out stock market volatility without the confidence of additional income to make up the losses. In this UPdate, we discuss one key investment structure that can prevent you from panic selling during the worst of market conditions.

The first four months of 2024 have been a wild ride for Wall Street. Investors don't respond well to change, and their typical response is to sell and ask questions later. In this issue we analyze the past two months market volatility and review what investors can learn about institutional investors in their response to potentially disruptive economic events.

This year investors have been challenged to navigate market volatility that so far has been based more on speculation than facts on the economy. Since President Trump's inaugurated, he has rolled out more policies these past 113 days than any president I can remember. Listen in this UPdate the status of market conditions and how investors can benefit from studying President Trump's previous term.

Since the inauguration of President Trump, investors have been very nervous about his administration's aggressive policy changes and process. He and his administration seem to be keeping Wall Street and Main Street on a "need to know" basis that is hard for business owners to plan their future. How investors are responding to the uncertainty and the prospects for the US stock market.

Institutional investors have once again become headline driven. Institutional traders seem to base their daily trading strategy on Trump tweets panicking on this announcement or another. Most interesting is their little regard to actual economic data. They obviously haven't learned much from President Trump's first term and his modus operandi. Listen in this UPdate on assessment of the economy and our suggestions on navigating through this market volatility.

The stock market is currently selling off over concerns of pending tariffs, similar to the investor fears that led to the 2022 selloff. In 2022, investors sold stocks in anticipation of the Federal Reserve's rate hike campaign to combat soaring inflation. Despite corporate profits continuing to rise throughout 2022, stock prices declined until the market began a strong rally in early 2023. The current market correction in 2025 mirrors 2022, but key differences remain—mainly the uncertainty surrounding the Trump administration's tariff policies. History shows markets typically rally once uncertainty clears. Listen in this UPdate as we compare today's market selloff to 2022 and the potential opportunities that may follow.

George Foreman affectionately known as "Big George" died this week on March 21 at the young age of 76. He has many accolades to be remembered by that include his boxing career, business successes, father, minister, and philanthropic causes. After winning Gold at the 1968 Summer Olympics, he entered professional boxing and over the next 20 years he fought 76 professional fights that he ended 68 with a KO. The US is another rising star in its early years compared to countries around the world that are 1,000's of years old. During this country's short tenure it has endured wars, bad government policies, civil unrest, and many other challenges. Listen in this UPdate our comparison of the great George Foreman to the US economy and our projections this year for the stock market.

For the past week, major media outlets have opined on the stock market volatility speculating whether this is the beginning of a significant stock market selloff and if the US economy is entering a deep recession cycle like 2008 or 1929. However, the media is overstating the damage to investor accounts. Year to date, the S&P 500 is down -5.26% and the Dow Jones Industrial Average (DJIA), the darling of the media because of the point fluctuation, is down YTD -2.61%. Listen in this UPdate our view of recent stock market volatility and strategies to navigate through this year.

Since December 6, 2024, the US stock market has been trading in a flat range up to February 19. However, the flat trading range weakened on January 27 when DeepSeek announced it had developed AI learning database using outdated Nvidia GPU for less than $6M. Investors panicked selling top AI company stocks with some share prices plummeting 15% - 20% that day. Even though the selloff was short lived, and nearly all the losses of that day were recovered within three weeks, investor confidence in the rally was shaken. Read in this UPdate, the events that followed DeepSeek's announcement that has accelerated the selloff along with our analysis of the potential outcome of this correction.

The University of Michigan released on Friday their Surveys of Consumers reports. The February report indicated that consumers' concerns are building after January's index decline that has continued into February. From the February surveys, consumers cited mounting worry about rising inflation due to tariffs. The Consumer Confidence Index dropped 13.5% to 64.7 in February from December's 74.0 index level. Listen in this UPdate our analysis of these reports and our stock market projections for 2025.

Investors entered 2025 with cautious optimism as stocks continued their strong rally, led by tech and AI. Despite a brief selloff in January, momentum remains positive, and new buying opportunities are emerging. Market corrections may be more volatile, but economic growth is broadening beyond tech. Stay informed on trends and opportunities in this week's update.

The US economy continues to improve in many areas that would indicate continued positive momentum and continued growth. In this UPdate we will focus on the US Bureau of Labor Statistics Job Openings and Turnover (JOLTS) report and Institute for Supply Management Manufacturing ISM Report on Business (ISM). Both reports provide insight on how employers are doing that will ultimately result in how the stock market performs in 2025. Listen in this UPdate our analysis and projections for 2025.

After two consecutive years of robust US stock market gains, investors are nervous about stock values and meeting high growth expectations, especially in the tech sector. For reference, the major indices' two-year run has been tremendous with the S&P 500 gaining 53.19% and NASDAQ gaining a whopping 84.50%. Listen in this UPdate our view of yesterday's wild market swing and today's rebound along with our forecast for 2025.

We have mentioned in past UPdates the importance of monitoring the financial and sentiment of US consumers. The primary reason is American spending represents a whopping 67.9% of America's Gross Domestic Product (GDP) otherwise known as gross revenue from all transactions (illustrated below by JP Morgan). Imbedded in the matrix of consumer spending is the freedoms Americans have that has always been the foundation of the world dominate US economy. Read in this UPdate our analysis of core of the US economy, consumers' impact, and our projections for 2025.

It may be just physiological, but I really enjoy January. Granted it's just another 30-day period like any other month. But January is motivating to me because it's the start of a new year to achieve new goals and experience new adventures. Read in this issue my personal hacks on how I venture into the new year with purpose and planning. More importantly, what you can learn from these hacks that may help you make 2025 your best year yet!

The National Federation of Independent Businesses (NFIB) index has been well below its 50-year average of 98 as respondents report challenges with labor, costs, inflation, and government policies. The index has not been this low for as long as it has since the Great Recession. However, in November the index jumped 8 points to 101.7 as business owners responded with robust optimism regarding the new administration. Read in this UPdate our view of the sudden change in small business owners optimism, the future prospect of the stock market, and specifically the future of small cap index.

My daughter loves to shop. In fact, her two love languages are shopping and someone paying for it. Apparently at least the shopping part is also a lot of people's love language. Adobe Analytics reported that between November 1 to 24 that US consumers spent a whopping $77.4 billion online, that is an increase of 9.6% over same time last year. In their report, Adobe Analytics reported that 21 of these 24 shopping days had over $3 billion in sales vs 16 days last year. Based on this early indication of sales Adobe Analytics is predicting an 8.4% increase year over year in this year's holiday season. Read in this issue our complete report on holiday retail sales and their possible indication going into 2025.

Late Friday afternoon on November 29, 2024, Anton and 61 others traveled from San Antonio to Reynosa, Mexico to volunteer for Strategic Alliance to build three houses for three related families all living in small shacks. Read in this issue his experience with pictures of his trip and the houses they built.

The housing market is facing challenges with plummeting sales and high mortgage rates, but rising new home construction and potential rate declines in 2025 could improve affordability. Homeownership remains a powerful wealth-building tool, offering significantly higher net worth compared to renting. If you're considering entering the market or investing, now is the time to plan strategically—reach out to us for guidance.

Looking back at Trump's first term offers insights into potential market impacts of his second. In 2016, markets rallied after his election, while 2024 has seen sustained growth and investor confidence regardless of the outcome. Key sectors—small caps, consumer discretionary, finance, and energy—are showing strong performance, with tech once again poised for growth.

I don't know about you, but it seems costs for everything is getting crazy. My wife went to the grocery store and items that were $9 last week are $14 this week. You can't tell me grocery store or supplier cost have jumped 56% in one week?!? Are prices really going up faster now than in the past? In this issue we analyze the changes in inflation and wages and compare the recent changes to historic averages.