Published August 6, 2026

Borrowing money to buy stocks is as old as the stock market. Every era dresses it up in new clothes. In 1929, an American could buy $100 of stock with $10 down, and everyone from chauffeurs to senators did. This summer’s model made its debut in South Korea. The wrapper was new. The ending was not.

Once again, the monthly scoreboard belied the turmoil underneath. The S&P 500 slipped 0.1 percent to close at 7,490. The Dow rose 0.3 percent for its fourth straight winning month. The Nasdaq fell 3.2 percent. Under the hood, it was one of the wildest months in years. A $45 billion American hedge fund was forced into liquidation. The world’s hottest stock market, South Korea’s, fell almost 11 percent in a single day. American semiconductor stocks dropped 20 percent while their businesses reported unprecedented orders, profits and backlogs.

The KOSPI, Korea’s version of the S&P 500, was until July the best-performing major market, roughly doubling in a year. Two companies, Samsung Electronics and SK Hynix, make most of the world’s memory chips (the foundation of the artificial intelligence boom) and together represent roughly 60 percent of the KOSPI index. In late spring, Korean brokerages began marketing funds that borrowed money to double the daily moves of those two stocks, and margin debt hit all-time records. The average small investor was carrying about three borrowed dollars for every one of their own.

An investor who owns shares outright can ride out any storm. An investor who borrows to buy shares cannot, because when the price falls far enough, the lender wants its money back. That demand is a margin call, and investors who cannot pay have their shares sold for them […]

Published July 10, 2026

Washington Irving gave us Rip Van Winkle, who slept for 20 years and missed a revolution. An investor who dozed off on New Year’s Eve and woke on the first of July would have missed a small one of his own. He’d be pleased to see the S&P 500 up 9.6 percent — a full year’s worth of gains delivered in six months — and he would know at a glance that something remarkable had happened. What he would not know is how hard those gains were to hold onto. The first half of 2026 packed in a war, an oil shock, a 7 percent plunge, a new Federal Reserve chairman and two dozen record highs. Our sleeper collected the returns while skipping the fear

The numbers tell the story of a round trip. When war broke out with Iran in late February, the S&P 500 fell as much as 7 percent as oil spiked and tanker traffic through the Strait of Hormuz collapsed. From those lows, the market staged one of the strongest recoveries in recent memory. By June 30 the index stood at 7,499, having set its 24th record high of the year on June 2. The Nasdaq gained 13.1 percent for the half. The Dow rose 9.8 percent for its best first half in five years. The Russell 2000 index of small companies did better still to end up roughly 20 percent. The second quarter alone delivered a 15.2 percent gain in the S&P 500 for its strongest quarter since 2020.

Two forces drove the recovery. The first was the relentless build-out of artificial intelligence infrastructure. The Philadelphia Semiconductor Index surged 88 percent in the second quarter — its strongest quarterly […]

Published June 5, 2026

After two months of bad news arriving fast and furious, May 2026 did something the previous quarter rarely allowed. It rewarded the long-term investor.

The major indexes finished the month firmly in the green. The S&P 500 rose 5.2 percent and closed at a record 7,580. The Nasdaq climbed roughly 8 percent. The Dow Jones crossed 51,000 for the first time. It was the S&P’s ninth straight winning week — a streak previously matched at the end of 2023. Considering where the market stood in late March, with the Nasdaq 100 in correction and oil moving vertically, this was a recovery that few predicted.

The cause of the rebound was the same waterway that caused March’s panic: the Strait of Hormuz, which was closed by Iran’s Revolutionary Guard in late February. The United States and Iran reached a tentative 60-day memorandum to pause hostilities and restore shipping. Brent crude, which had spiked toward $120, fell nearly 19 percent in May to around $92 — its biggest decline since the depths of the pandemic. The ceasefire remains fragile, missile strikes continue in the Persian Gulf as negotiations continue, and any reopening of the Strait of Hormuz will likely be partial at best. The war premium has drained out of oil prices, but the conditions that created it have not been resolved.

While stocks celebrated, the yield on the 30-year Treasury bond surged to 5.2 percent — its highest level since July 2007. Most working adults have never managed their finances with long-term borrowing costs this high. This is not an American phenomenon. Japan’s 30-year yield hit a record dating back to 1999, the United Kingdom’s long […]

Published May 8, 2026

Last month, I described a market trying to find clarity in chaos and called for painting with a finer brush. April supplied a new canvas. The S&P 500 finished April up roughly 10.5 percent — its best month since 2020. The Nasdaq added more than 15 percent and the Dow gained more than 7 percent. By early May, the S&P had closed above 7,200 and kept rising. A market that had been bracing for stagflation sprinted in the opposite direction.

The reversal was not built on better headlines. The standoff with Iran that closed the Strait of Hormuz remains unresolved. After Iran briefly reopened the strait on April 17, talks broke off and a blockade was implemented. Brent crude settled near $110 and West Texas Intermediate just above $100, with S&P Global telling the world to plan for “higher for longer.” The Federal Reserve held rates at 3.50 to 3.75 percent on April 29, with four dissents. Payrolls came in at 177,000 and first-quarter GDP rebounded to 2 percent annualized from 0.5 percent. The economy is strong, and while the consumer is still buying everything except homes, the real strength is coming from the companies pouring concrete, copper, and silicon into the ground to meet the massive need for computing resources.

That is the story that took over the market in April. Five of the largest technology companies reported earnings, each one expanding its capital spending plans. Alphabet, Amazon, Microsoft, and Meta now expect to spend $650 billion to $725 billion combined on AI infrastructure in 2026. That figure exceeds the GDP of Switzerland and rivals the annual federal Medicare budget. Amazon committed $200 billion, Microsoft $190 billion, Alphabet $180 billion, and Meta raised […]

Published April 10, 2026

Some months test your patience. March tested your convictions. After two months of violent rotation beneath relatively calm numbers, the geopolitical crisis that had been building since late February exploded into full view. The S&P 500, Dow Jones and Nasdaq all fell about 5 percent, with the Nasdaq 100 sliding more than 10 percent from its recent peak. Remember, 5 percent pullbacks are common and generally happen several times each year, while 10 percent corrections usually occur every two years. This time, all economic sectors finished in the red except one. Energy was the lone survivor, surging roughly 10 percent because of oil prices.

The catalyst for the market decline was the U.S.-Israeli military strike on Iran that began Feb. 28. Iran retaliated with missile and drone strikes against Israeli targets and American installations across the Persian Gulf. But the most consequential response was not militaristic; it was economic. Iran’s Revolutionary Guard effectively closed the Strait of Hormuz to commercial shipping, choking off roughly 20 million barrels of crude oil and petroleum products per day. That narrow waterway handles about 20 percent of the world’s petroleum. Its closure triggered the largest supply disruption in the history of the global oil market and informed Iran that it has an even stronger and more practical negotiating hand than its nuclear ambitions provide.

The price reaction was swift and severe. Brent crude soared roughly 60 percent during March, its largest monthly increase on record, peaking near $119.50 per barrel. West Texas Intermediate crossed $100 for the first time since mid-2022, eventually topping $115. The International Energy Agency coordinated the release of 400 million barrels from strategic reserves. […]

Published March 6, 2026

Readers of my column last month will recall that January was described as calm above a storm raging below. The major indexes posted modest gains, while one of the most violent rotations in recent memory ripped through individual stocks and sectors. Did February bring calmer seas? It did not. The S&P 500 slipped less than 1 percent for the month, closing at 6,879. The Dow eked out a small gain, finishing at 48,978. The Nasdaq took the worst of it, falling 3.3 percent to close at 22,668. Once again, the surface told you almost nothing about what really occurred.

The sector rotation that began in January intensified. Money continued pouring out of the mega-cap technology stocks that had dominated the last two years into cyclical sectors: energy, materials, industrials. Wall Street dubbed it the HALO rotation: Heavy Assets, Light Other. Energy stocks surged over 14 percent in January and kept climbing. Materials gained nearly 9 percent. The equal-weight S&P 500, which gives every company the same importance regardless of market value, outperformed the capitalization-weighted index by its widest margin since March 2025. Nine of 11 sectors moved higher. The headline number looked flat only because the mega-cap tech names carrying so much weight were dragging it lower. As noted last month, money is not leaving the market. It is moving to different neighborhoods. In February, those neighborhoods got even more crowded.

What was happening to those technology stocks? Two words: AI panic. Nvidia CEO Jensen Huang proclaimed that February marked the inflection point for agentic AI — the arrival of autonomously reasoning AI that plans, decides and executes multistep tasks. The software sector experienced […]

Published February 6, 2026

There’s an old Wall Street saying that as January goes, so goes the year. If the January barometer is to be believed, 2026 is off to a promising, if turbulent, start. The S&P 500 gained 1.2 percent. The Dow rose 1.6 percent. The Nasdaq advanced 1.1 percent. The S&P briefly touched 7,000 for the first time in its history. Historically, when January has ended positively, the full year has finished higher about 89 percent of the time, with gains averaging 17 percent.

Those index numbers obscure what was happening underneath. January was one of the most volatile months in recent memory, not because the indexes moved much, but because nearly everything else did. The calm above concealed a storm below.

For two years, the “Magnificent Seven” mega-cap tech stocks dominated returns. In January, that dominance cracked. The Russell 2000 outperformed the S&P 500 for 11 consecutive sessions, a streak seen only eight times since 1979. Small-cap value gained nearly 6 percent while large-cap growth went nowhere. Materials surged 9 percent, drawing a record $6.5 billion in weekly inflows. Industrials rose after the ISM Manufacturing PMI showed expansion for the first time in 12 months. Financials attracted $3 billion. Meanwhile, tech funds saw $1.4 billion in outflows in late January alone. The money wasn’t leaving the market; it was moving to different neighborhoods.

This broadening is healthy. When a handful of names drive returns, the market is fragile. When participation is broad, the foundation is durable. For investors who maintained diversified portfolios, January was vindication.

The Federal Reserve held its course. At its Jan. 28 meeting, the committee voted 10-2 to keep rates at 3.5 to 3.75 […]

Published January 12, 2026

2025 offered investors a year that tested nerves, rewarded patience, and reminded us why we stay invested despite the headline news and trading turmoil. The S&P 500 finished the year up 16 percent, the Nasdaq climbed 20 percent, and the Dow Jones Industrial Average rose 13 percent. It was the third consecutive year of double-digit gains. That isn’t bad for a year that included what traders are now calling the “April Shock” — one of the largest cumulative two-day drops for the S&P on record.

December itself was a quiet month. The S&P finished essentially flat, the Nasdaq dipped half a percent, and the Dow eked out a 0.7 percent gain for its eighth winning month in a row. No fireworks or widely anticipated Santa Claus rally occurred at year-end. Santa’s GPS must have malfunctioned, because he instead arrived with his rally in the first few trading days of 2026.

But what a year it was getting there. In early April, sweeping tariff announcements for our closest allies and largest trading partners sent markets into a tailspin. The S&P 500 dropped more than 10 percent in just 48 hours. Trillions of dollars in market value vanished. The financial press was filled with dire predictions. Recession calls multiplied like rabbits in springtime.

When most of the draconian tariffs were quickly postponed or retracted when the stock market plummeted, the negative market reaction immediately reversed. Despite this whiplash chaos unfolding in financial markets, corporate quarterly earnings reports held firm, reminding traders of the underlying strength of the U.S. economy. Stocks staged one of the fastest V-shaped recoveries in recent memory. By late June, the major indices had […]

Published December 5, 2025

Sometimes the best action is no action at all. November tested that principle as traders whipsawed themselves trying to react to every headline, while long-term investors watched the show from the sidelines.

Looking at the scoreboard you would think nothing happened. The S&P 500 inched up 0.1 percent, the Dow gained 0.3 percent, and the Nasdaq slipped 1.5 percent. But anyone who lived through the month knows these numbers are like saying a roller coaster is flat because it ends where it started. The difference between those who traded every twist and those who held steady? The patient investors ended the month right where they started, without the transaction costs and stress.

The Federal Reserve cut rates by another quarter point on Oct. 29, bringing the federal funds rate down to 3.75-4 percent, with the committee split three ways. One member wanted a bigger cut; another wanted no cut at all. That kind of disagreement at the Fed is unusual, and it tells you something. Fed Chair Jerome Powell himself admitted at the press conference that there were “strongly differing views” about December, warning that another cut isn’t “a foregone conclusion.”

Here’s where it gets interesting. During the month we were still dealing with the longest government shutdown in history: 43 days from Oct. 1 to Nov. 12. Because federal statisticians were furloughed, we simply didn’t get an October jobs report. The November inflation data has been pushed to December. The Fed will walk into its December meeting partially blind, and so will investors. In 30 years of watching markets, we have never seen anything quite like it.

Yet beneath this uncertainty, corporate America kept churning […]

Published November 7, 2025

Never mind that the government couldn’t tell us whether we had jobs or inflation. The stock market powered straight through October’s data fog. The S&P 500 rose 2.3 percent for the month, the Nasdaq gained 4.7 percent, and the Dow added 2.5 percent, extending multi-month winning streaks for all three indices. Here’s the kicker: they did it while the U.S. Bureau of Labor Statistics posted a notice saying updates had stopped. Meanwhile, Treasury desks dusted off a rarely used TIPS fallback procedure in case the Consumer Price Index couldn’t be published on time — a reminder that markets sometimes must fly by instruments that have not been calibrated in years.

With the federal government shut down since Oct. 1, the U.S. Bureau of Economic Analysis, the BLS and the Census Bureau curtailed most releases, leaving investors to triangulate the economy with private indicators and stale prints. The October jobs report that normally drops the first Friday of the month could not be found. The CPI release got pushed back a week, and there were genuine concerns it might not be published at all if the shutdown persisted. For the first time in memory, the Federal Reserve had to make a rate decision essentially flying blind.

Against this backdrop of uncertainty, the Fed cut rates by 25 basis points to a range of 3.75-4 percent on Oct. 29, although Chair Jerome Powell made it crystal clear that another cut in December “isn’t a foregone conclusion; far from it.” As he said during the press conference: “What do you do if you’re driving in the fog? You slow down.” The vote itself tells you something about […]