September is here, which means two things in my house: my teenagers are back in school (finally) and football is back (will the 49ers be good this year… I can only hope). Fall has always been my favorite time of year - that sweet spot between the chaos of summer and the holiday rush where the markets, much like my household, try to find a little balance.
August gave us plenty of reasons to stress - tariffs, Fed policy debates and tech earnings - yet markets still managed to hit new highs. Stocks and bonds both held their own, reminding us that sometimes resilience shows up when you least expect it.
We saw tariffs officially kick in, only to be thrown into legal limbo after a federal court ruled them unlawful. Inflation readings reflected those costs trickling through, sparking worries the Fed would keep interest rates higher for longer. For a moment, markets looked wobbly. But better-than-expected earnings - with 81% of S&P 500 companies beating profit expectations, the best showing since 2023 - came to the rescue, sending stocks back up by the end of the month.
The economy grew at 3.3% in Q2 - stronger than initially reported - though jobs data came in weaker and these revisions even cost the BLS Commissioner his job. Still, in a tale as old as time - Corporate America (like kids adjusting to new teachers) seems to find a way to adapt and deliver when it counts. Earnings are my favorite metric for a reason: they remind us that behind every chart and headline are real companies innovating, cutting costs, and finding ways to grow.
Looking ahead, the Fed has hinted that rate cuts could be on deck starting this fall. Lower rates could help both sides of the portfolio: stocks get a growth boost, while bonds deliver better relative value. With 10-year Treasuries hovering between 4.0% and 4.5% and corporate bonds near 5%, income from fixed income remains attractive.
The bottom line? Just like the end of summer, markets are shifting seasons. Tariffs, policy debates and economic bumps aren’t going away, but strong earnings and steady growth keep the long-term picture intact. The best play remains the same: stay diversified, stay invested and don’t overreact to every headline.
Now, if only I could be as confident about the 49ers’ playoff chances as I am about long-term investing.
Until next time, take good care,
