Just one huge trade.
Or a big real estate deal.
A lucky investment.

The truth about building wealth is honestly a lot less exciting. Most wealth is built slowly… almost boringly… through consistency.

That’s the quiet power of dollar-cost averaging¹.
And it’s one of the most powerful tools everyday investors have.

But before we get there, let’s take a look at what happened in markets last week.

🎥 Watch the full episode:

State of Capital

Markets remained volatile as investors digest geopolitical tensions, inflation risks, and the evolving economic outlook.

As of last Friday, the S&P 500 is down roughly 4.7% year-to-date², but that number hides some pretty dramatic differences across sectors. Energy has been the standout performer. The S&P 500 energy sector is up more than 32%², driven largely by tight global supply and ongoing geopolitical tensions.

Meanwhile, other parts of the market are struggling. Consumer discretionary stocks have been under pressure as higher fuel prices ripple through the economy. Airlines in particular have taken a hit as jet fuel costs surge amid tensions in the Middle East³.

Broadly speaking, we’re also seeing a rotation toward quality and away from speculation. Value stocks have been outperforming growth⁴.

The Russell 2000, which tracks smaller publicly traded companies, is down on the year². The NASDAQ has also pulled back significantly and is approaching bear-market territory relative to its 52-week high².

International markets are telling a slightly different story.

Asian markets have been outperforming the U.S., while European markets have struggled under the weight of slower growth and energy concerns⁵.

What is the key takeaway here? This is a market where selectivity matters. Not everything moves together anymore. And that brings us to one of the most overlooked investment strategies out there.

Policy & Economics

America’s Housing Problem

One of the biggest structural challenges facing the U.S. economy today is housing supply.

Estimates suggest the country is short somewhere between 3 million and 6 million housing units relative to current demand⁹.

That imbalance has been building for years. Demand for housing has remained strong since the Great Financial Crisis, supported by population growth and immigration¹⁰.

But construction simply hasn’t kept up and what’s the result? Home prices have become unaffordable for the everyday person.

Since the pandemic, U.S. home prices have risen roughly 50%¹¹. And the effects are BEEN visible. Decades ago, the average first-time homebuyer in America was around 30 years old. Today, that number has climbed closer to 40¹². This is why housing policy needs to focus on increasing supply. We don’t solve this problem by penalizing builders, developers, or investors. We solve it by incentivizing them to build more housing. This is a supply side problem, not a demand side problem.

That means creating policies where government and private industry work together to bring more units to market. More supply doesn’t fix everything overnight. But over time, it helps bring balance back to the housing market.

The Breakdown

Why Dollar-Cost Averaging Still Works

If there’s one investing strategy I wish more people understood, it’s dollar-cost averaging¹.

It’s simple. Let’s not make learning financial literacy any harder than it has to be!

Instead of trying to perfectly time the market, you invest a fixed amount of money on a regular schedule. Weekly. Monthly. Quarterly. Whatever works for you.

Let’s say someone invests $200 every month into a diversified portfolio. Some months they’ll buy when markets are high. Other months they’ll buy when markets are low. But over time, that discipline smooths out volatility and allows investors to steadily accumulate assets. Oh, by the way, this is how you buy low and sell high!

The real magic happens when you combine this with compounding⁶.

A small amount consistently invested doesn’t change your life overnight.

You’re def not going to suddenly feel rich. But over time - and especially decades - those contributions begin to snowball. Think of it like planting seeds. One seed doesn’t change much. But if you plant seeds every week, every month, every year… eventually you grow a forest. The key is systematizing the process.

Set it up once. Automate it. Don’t over complicate this.

Then get on with your life. No market predictions, day trading or noise.

The Property Playbook

Let’s Talk About Cap Rates

In my property management class this week, we talked about capitalization rates, or cap rates.

It’s one of the most fundamental concepts in real estate investing.

In simple terms, the cap rate represents the annual return generated by a property based on its income⁷.

For example, if a building produces $100,000 in annual net operating income and it’s valued at $1,000,000, the cap rate would be 10%.

Think of it as a snapshot of the property’s annual profitability relative to its price.

But there’s an important caveat. Those numbers are only as good as the assumptions behind them. Investors always need to look closely at things like:

• Actual rent collections

• Operating expenses

• Maintenance costs

• Vacancy rates

Sometimes properties look more profitable on paper than they are in reality. And as with most things in finance, higher returns usually mean higher risk⁸. A property with a very high cap rate might be located in a market with weaker demand, higher vacancy risk, or more economic volatility. As always, context matters.

Book a free consultation with NJK

The Conversation

The biggest lesson this week is that investing is not supposed to be flashy. In fact, the most effective strategies are often very simple. Invest consistently. Understand what you own and the fees you’re paying. And focus on long-term compounding.

It might not change your lifestyle next month. But over time, it can absolutely change your life.

If you found this helpful, feel free to share it with someone who’s trying to better understand money and markets. Because the truth is, financial education shouldn’t be reserved for Wall Street. It should be accessible to everyone.

If you’ve been reading this newsletter and thinking “I should probably get more serious about this,” you’re right. And we’re here when you’re ready.

→ Schedule a call with NJK Wealth Management: No minimums. No commissions. No judgment. Just a real conversation about your money.

We’re teaching money the way it should’ve been taught to us. If this issue helped you understand what’s happening, share it with someone who could use it.

Share

Sources

¹ Morningstar – Portfolio strategy research: education resources on dollar-cost averaging

² S&P Global – S&P 500 sector performance data

³ International Energy Agency – global fuel and energy market impacts

⁴ MSCI – value vs growth performance data

⁵ International Monetary Fund – regional economic outlook and market trends

⁶ U.S. Securities and Exchange Commission – investor education on compounding returns

⁷ National Association of Realtors – definition of capitalization rates

⁸ CBRE – commercial real estate risk-return dynamics

⁹ National Association of Realtors – U.S. housing shortage estimates

¹⁰ U.S. Census Bureau – population and household formation data

¹¹ Federal Housing Finance Agency – home price index data

¹² National Association of Realtors – first-time homebuyer age statistics

That feels like a different era. This week we break down what’s actually happening beneath the headline numbers, why the S&P 500 is hiding a much bigger story, and the one question every investor should be able to answer about their own portfolio.

🎥 Watch the full episode:

State of Capital

As of last week, the S&P 500 is down roughly 3–4% year-to-date.¹ The Russell 2000 has given back almost all of its gains and is basically flat on the year.² And the mood across markets has gone from cautious optimism to something much more tense.

But here’s the thing most people are missing right now. The headline numbers — “the S&P is down,” “the market is struggling” — they’re hiding something much more interesting.

Inside the S&P 500, the energy sector is up more than 25% year-to-date.³ Meanwhile, financials are down significantly — banks and lenders pulling back from certain strategies as interest rates stay elevated and uncertainty grows.³

Same index. Completely different outcomes depending on which sector you’re looking at.

And that’s worth sitting with for a second. Because the S&P 500 tracks 500 of the largest publicly traded companies in the U.S., but it doesn’t treat them all equally. Energy companies make up less than 5% of the index by weight, yet they’ve dramatically outperformed everything else this year.³ If you only looked at the index-level number, you’d never know that.

The 10-year U.S. Treasury yield closed around 4.28% last week, up from below 4% just a few weeks earlier.⁴ That move matters because the 10-year influences everything from mortgage rates to how much it costs for companies to borrow money. When it rises, it puts pressure on valuations across the board — especially for growth stocks that depend on future earnings.

This is the part of markets most people don’t see. It’s rarely one story. It’s dozens of different stories happening at the same time, inside the same indexes, pulling in different directions. And the investors who understand that have a major advantage over the ones just watching the headlines.

Policy & Economics

There’s a lot happening at the macro level this week, and all of it connects back to the same theme: uncertainty is expensive.

The Fed, Inflation, and the Word Nobody Wants to Hear

Inflation is still running around 3% annually — roughly 50% higher than the Federal Reserve’s 2% target.⁶ That gap is one of the key reasons policymakers remain cautious about cutting interest rates, even as the labor market weakens.

A federal judge recently dismissed a case challenging Federal Reserve authority, reinforcing the independence of the central bank and Chairman Jerome Powell’s ability to guide monetary policy without political interference.⁵ That matters because in an environment this volatile, the credibility of the institution making rate decisions is itself a stabilizing force.

But the real concern right now is a word economists have started using more frequently: stagflation.

Stagflation is what happens when inflation stays elevated while economic growth slows and unemployment starts to rise. It’s one of the hardest environments for policymakers to navigate because the tools you’d normally use to fight inflation (raising rates, tightening financial conditions) can also accelerate the slowdown. You’re fighting the disease with medicine that makes the patient sicker.

We’re not officially in stagflation. But the conditions are lining up in ways that make the conversation unavoidable.

Energy, the SPR, and Why Global Markets Still Matter

The United States just committed to releasing 172 million barrels from its Strategic Petroleum Reserve — roughly 40% of what’s currently in the tank.⁷ That’s part of a larger coordinated effort by 32 IEA member nations to release a combined 400 million barrels, which represents about one-third of the IEA’s total government-controlled emergency reserves.⁷

That’s a massive move. And it tells you how seriously governments are taking the current supply situation.

Tariffs and geopolitical tensions are compounding the problem. When companies face higher costs for energy, materials, and imported goods, those costs get passed along to consumers. That keeps inflation elevated even as the economy slows — which loops right back into the stagflation concern.

Now, today’s energy situation is fundamentally different from the 2008 oil crisis. Back then, the U.S. was heavily dependent on imported oil. The shale revolution changed that dramatically, turning America into one of the world’s largest energy producers and exporters.⁸ That’s a structural advantage we didn’t have before.

But oil is still a global commodity. Events thousands of miles away still move prices at your local gas station. And that brings us to a concept worth understanding.

The Petrodollar — and Why Some Countries Want to Change the Rules

The petrodollar system refers to the long-standing practice of conducting global oil transactions in U.S. dollars. This has historically reinforced demand for the dollar as the world’s primary reserve currency — which affects everything from the interest rates we pay to the purchasing power of our savings.¹¹

Some countries, including Iran and China, have been exploring the idea of settling energy transactions in other currencies, particularly the Chinese yuan. If that practice were adopted widely, it could gradually challenge the dollar’s dominance in global trade.¹¹

That’s not happening overnight. But the conversation is real, and it’s worth understanding because the dollar’s reserve status is one of those things most people take for granted until it starts to erode.

The Cost of Conflict

Estimates suggest the current military engagement is costing roughly $1 billion per day.⁹ Sustained over a full year, that would add up to approximately $350 billion — nearly 40% of the roughly $1 trillion annual U.S. defense budget.¹⁰

That matters because the United States is already running large deficits, and rising borrowing costs compound fiscal pressure over time. The cost of war isn’t just measured in human terms. It shows up in bond markets, interest rates, and ultimately in the federal budget that funds everything else.

The Breakdown

Income vs. Appreciation — and Why It Matters More Than You Think

When you buy an asset (whether it’s a stock, a rental property, or a small business) there are really only two ways you make money from it.

The first is income. This is cash that the asset generates while you hold it. A business makes money by selling products or services. A dividend-paying stock distributes a portion of its profits to shareholders. In real estate, income usually comes from collecting rent. The asset pays you for owning it.

The second is appreciation. You buy something at one price, and over time, the value goes up. You sell it later for more than you paid. That’s it. It’s that simple!

Most investments combine both. A rental property might generate monthly income from tenants while also increasing in value over the years. A dividend stock pays you quarterly while (hopefully) the share price climbs.

But here’s where investors get into trouble: expecting one type of return from an investment designed for the other.

If you buy an appreciation play and expect it to generate steady income, you’ll be disappointed. If you buy an income-producing asset and expect it to double in value in two years, you’ll probably be frustrated. The investment isn’t broken — the expectations are.

Understanding what type of return your investment is actually designed to produce is one of the most important disciplines in investing. It sounds basic. But misaligned expectations are responsible for more bad decisions than bad markets are.

The Property Playbook

Core, Value-Add, and Opportunistic — Know What You’re Getting Into

In real estate, investors typically categorize deals based on risk profile and strategy. And these categories matter a lot, because the range of risk in real estate is enormous. A fully stabilized apartment building and a ground-up development project are both “real estate,” but they have almost nothing in common from an investment standpoint.

Core properties are the most stable. These are fully renovated, fully occupied assets generating reliable cash flow — the kind of buildings investors sometimes call “trophy assets.” The returns tend to be steady and predictable, but modest. You’re not swinging for the fences. You’re collecting consistent income from a high-quality asset.

Value-add properties require some kind of improvement. Maybe the building needs renovation. Maybe the operations need restructuring, or the leases need to be renegotiated, or the property needs rebranding. Investors take on more risk, but the upside is that active management can meaningfully increase the property’s value over time.

Then there are opportunistic deals. These are usually the highest-risk strategies in real estate — ground-up development, distressed assets, complex permitting situations, large-scale redevelopment projects. Sometimes it literally starts with digging a hole in the ground and building something entirely new.

I always tell my real estate students this: don’t take opportunistic-level risk while expecting core-level stability.

That misalignment is exactly where investors get into trouble. Greater risk can produce greater rewards. But only if you actually understand the risk you’re taking, you’ve planned for the downside, and you’re not fooling yourself about what category your investment falls into.

If you’re curious about how real estate fits into your broader financial picture, that’s something we work through in our consultations at NJK Wealth Management.

Book a free consultation with NJK

The Conversation

Two investors can own the exact same index fund — same ticker symbol, same expense ratio, same everything — and have completely different experiences of the market right now. One of them works in energy and sees their sector up 25%. The other works in banking and watches financials slide. Same portfolio. Different emotional reality.

That disconnect is actually one of the most important things to understand about markets. The number on the screen isn’t the whole story. It never is. Behind every index is a collection of industries, sectors, and companies that are all responding to different forces at the same time. Some are thriving in this environment. Some are struggling. And the mix changes constantly.

The investors who get this (who understand that “the market” isn’t one big thing moving in one direction) tend to make better decisions. Not because they can predict what’s coming, but because they don’t overreact to a single number that was never designed to tell the full story in the first place.

We spend a lot of time in this newsletter talking about what markets are doing. The numbers, the sectors, the macro trends. That stuff matters. But the thing that actually determines whether any of this helps you build wealth over the long run is much simpler.

Do you know what you own? Not the ticker symbol. Not the name of the fund. Do you know whether your investments are designed to produce income or appreciation? Do you know what sectors you’re exposed to? Do you know whether you’re taking core-level risk or opportunistic-level risk?

Most people don’t. And that’s not a criticism — it’s a gap that exists because nobody taught them to ask those questions.

That’s why we started Invested In Us, and that’s why we built NJK Wealth.

If you’ve been reading this newsletter and thinking “I should probably get more serious about this,” you’re right. And we’re here when you’re ready.

→ Schedule a call with NJK Wealth Management: No minimums. No commissions. No judgment. Just a real conversation about your money.

We’re teaching money the way it should’ve been taught to us. If this issue helped you understand what’s happening, share it with someone who could use it.

Share

Sources

1. S&P Dow Jones Indices — S&P 500 Year-to-Date Performance

2. FTSE Russell — Russell 2000 Index Data

3. S&P Global / Yahoo Finance — Sector Performance Breakdown (Energy, Financials YTD)

4. Federal Reserve Economic Data (FRED) — 10-Year Treasury Yield

5. Congressional Research Service — Federal Reserve Independence and Legal Structure

6. U.S. Bureau of Labor Statistics — Consumer Price Index Data

7. U.S. Department of Energy / International Energy Agency — Strategic Petroleum Reserve Release, March 2026

8. U.S. Energy Information Administration — U.S. Oil Production & Exports

9. Congressional Budget Office — Military Operations Cost Estimates

10. U.S. Department of Defense Budget Reports

11. International Monetary Fund — Global Reserve Currency and Trade Settlement Data

If you read last week’s issue, you know markets were already walking a tightrope. Then the Middle East happened, and the tightrope snapped.

Israel bombed 30 Iranian fuel depots over the weekend. Oil exploded past $100 a barrel on Monday morning before pulling back. The February jobs report came in worse than anyone expected. And the Federal Reserve is now stuck between two options, both of them bad.

We’re going to break all of it down. But first, we have a big announcement.

NJK Wealth Management Is Officially Open

This has been a long time coming.

NJK Wealth Management is now officially registered and open for business.

No minimums. No commissions. No cookie-cutter plans.

We built NJK Wealth because we believe everyone deserves access to real, personalized financial guidance, not just people who already have money. The wealth management industry has spent decades telling everyday families they don’t have “enough” to deserve professional advice. We think that’s wrong.

Here’s what that looks like in practice: customized financial plans built around your actual life, your goals, and your family’s future. Your assets will be held with one of the largest and most trusted custodians in the world, and you work directly with us —not a call center, not a chatbot, not an AI advisor.

This is what we’ve been building toward with Invested in Us from the beginning. The newsletter teaches you how money works. NJK Wealth helps you put that knowledge into action.

If you’ve been waiting for a sign to get serious about your financial future, this is it.

Book a free consultation with NJK

State of Capital

Let’s talk about what happened last week, because it was a lot.

The VIX—the market’s “fear gauge”—surged past 35 last week, more than double where it started the year.¹ That tells you investors went from cautious to genuinely nervous almost overnight.

The Dow posted its worst week since April. The Russell 2000 had its worst week since August. Small caps are now down more than 5% on the month. And just a few weeks ago, we were talking about how the Russell 2000 was outperforming the S&P 500.

That’s how fast things can turn.

Small-cap companies are typically the first to feel the pressure when growth concerns show up. They carry more debt, they’re less diversified, and they depend more heavily on the domestic economy. So when investors start worrying about a slowdown, they rotate out of small caps and into larger, more financially stable companies. That rotation happened aggressively last week.

And here’s the thing—despite all the turmoil, the S&P 500 is still trading at roughly 21x forward earnings.² That’s historically expensive for an environment where geopolitical risk is escalating, inflation is threatening to come back, and interest rates haven’t come down. The market is essentially betting that corporate earnings will keep growing fast enough to justify the price tag.

That’s a real bet. And this week will tell us a lot about whether it pays off.

Policy & Economics

The Strait of Hormuz Is Back in the Headlines

If you’ve never heard of the Strait of Hormuz, you’re about to hear about it a lot.

It’s a narrow waterway between Iran and the Arabian Peninsula, and roughly 20% of the world’s oil supply passes through it every day.⁵ In some areas, the shipping lane is only about two miles wide. It is, by almost any measure, one of the most strategically important chokepoints on the planet.

After the U.S. and Israel conducted coordinated strikes on Iranian targets over the weekend, the big question became: does this spill over into shipping? Because if tankers start rerouting, or if insurance costs spike, or if Iran retaliates by disrupting traffic through the strait—you don’t even need an actual supply disruption to send energy prices surging.

Just the possibility is enough. And we saw that play out in real time.

WTI crude oil spiked to nearly $120 a barrel on Monday morning before pulling back sharply after President Trump told CBS News that the military operation is nearly complete.³ Brent crude settled around $94, up roughly 50% from the start of the year according to the EIA’s latest short-term outlook.³

When energy prices spike like that, the effects don’t stay contained to gas stations. Higher oil feeds into transportation costs, which feeds into food prices, which feeds into manufacturing inputs, which feeds into basically everything. A common rule of thumb: every $20 increase in oil adds roughly $0.50 per gallon at the pump. Multiply that across a household’s annual fuel consumption and the broader inflation ripple, and you’re talking about real money.

The Jobs Report Made Things Worse

On Friday, the Bureau of Labor Statistics reported that the U.S. economy lost 92,000 jobs in February.⁴

Economists were expecting a gain of roughly 50,000.

That’s not just a miss—it’s a reversal. And the revisions made it even uglier: December was revised from a gain of 48,000 to a loss of 17,000. January was revised down slightly to 126,000.⁴

Now, some important context. A big chunk of February’s losses came from healthcare, which shed 28,000 jobs largely because of a Kaiser Permanente strike in California and Hawaii that pulled more than 30,000 workers off payrolls during the BLS survey week.⁴ That strike has since been resolved, so some of that should bounce back in March. Federal government employment also continued to decline, down another 10,000 for the month—part of a broader reduction of 330,000 federal jobs since late 2024.⁴

But even with those caveats, the trend is concerning. This was the third time in the past five months that payrolls declined. The economy has averaged fewer than 5,000 new jobs per month since January 2025.

The Fed Is Trapped

So now you’ve got oil prices threatening to reignite inflation and a labor market that’s weakening at the same time. That combination has a name: stagflation. And it’s basically the worst-case scenario for central bankers.

The Federal Reserve currently has rates at 4.50–4.75%. Markets are pricing in the possibility of two to three rate cuts later this year. But here’s the problem: if they cut rates to support the economy, they risk pouring gasoline on an inflation fire that oil prices are already stoking. If they hold rates where they are, they risk watching the labor market deteriorate further.

There’s no clean answer. And that uncertainty is exactly what’s driving the volatility.

The Breakdown

Target Date Funds: The Autopilot Portfolio

Let’s talk about something that sits inside millions of retirement accounts that most people never fully look into.

Target date funds.

If you’ve ever logged into your 401(k) and seen something like “Target Retirement 2040” or “Target Retirement 2055”—those are target date funds.

The concept is straightforward. You pick the fund that matches roughly when you plan to retire. The fund manager handles the rest.

When retirement is decades away, the fund holds more stocks—because stocks have historically produced higher long-term returns, and you have time to ride out the dips. As you get closer to retirement, the fund gradually moves into bonds and more stable investments to protect what you’ve built. This gradual transition is called the “glide path.”

You don’t have to rebalance anything yourself. You don’t have to decide when to move out of stocks. You don’t have to panic-sell during a downturn and try to time your way back in.

That last part matters more than people think. The single biggest mistake most investors make isn’t picking the wrong fund. It’s panicking and changing their strategy at exactly the wrong moment. Target date funds are designed to take that impulse off the table.

Now, they’re not flawless. Different fund companies design their glide paths differently—some are more aggressive, some more conservative. And fees vary, so it’s worth checking what you’re paying. But for a long-term investor who doesn’t want to spend their weekends researching portfolio allocation models, a target date fund can be a genuinely solid foundation.

Not everything in investing needs to be complicated. Sometimes the smartest move is building something that runs in the background while you live your life.

The Property Playbook

Welcome to a new recurring section of Invested in Us. Each week, we’ll break down a concept, strategy, or trend in real estate investing —because real estate is one of the most powerful wealth-building tools in the world, and most people only know the surface level.

How the Biggest Investors in the World Think About Real Estate

When most people think “real estate investing,” they think of buying a house or maybe an apartment building. That’s real estate. But it’s one slice of a much bigger picture.

Institutional investors—the pension funds, endowments, and sovereign wealth funds managing hundreds of billions of dollars—look at real estate as a collection of specialized sectors, each with completely different risk profiles, return characteristics, and economic drivers.

The major sectors most people know: residential (apartments, single-family rentals, manufactured housing), office (corporate buildings), retail (shopping centers, malls), and hospitality (hotels, resorts).

But the sectors that have been growing fastest are the ones most people never think about: senior housing, data centers, and self-storage facilities. Data centers alone have become one of the most in-demand property types on the planet as artificial intelligence and cloud computing have exploded. Senior housing is being driven by demographics that are basically locked in for the next 20 years.

Each of these sectors responds differently to economic conditions. When oil prices spike and inflation rises—like right now—some real estate sectors get squeezed while others actually benefit from the pricing power that comes with essential services. Knowing the difference is what separates professional capital allocation from guessing.

We’ll go deeper on individual sectors in future issues. For now, the takeaway is this: real estate is not one thing. And the more you understand about how institutional money thinks about it, the better positioned you are to make smart decisions with your own.

Closing Thoughts

Here’s what stood out to me this week.

In the span of a few days, oil went from $80 to nearly $120 and back down again. The jobs report swung from an expected gain to an actual loss. Markets went from “cautiously optimistic” to “genuinely scared” and then partially recovered—all before most people finished their Monday morning coffee.

The speed of it is the story.

We live in a world where a shipping lane most people have never heard of can directly affect what you pay for gas and groceries next month. Where a strike at one hospital system in California can move a national employment number. Where a comment from a president on a phone interview can swing oil prices $20 in an hour.

None of that means you need to react to every headline. It means the opposite, actually. The people who did best last week were the ones who already had a plan—who weren’t scrambling to figure out what their portfolio looked like after the news broke.

That’s what financial planning is really for. Not predicting the future. Surviving it.

If this week is making you think more seriously about your financial plan, we’d love to talk.

→ Schedule a call with NJK Wealth Management

We’re teaching money the way it should’ve been taught to us. If this issue helped you understand what’s happening, share it with someone who could use it.

Share

Sources

1. CBOE Volatility Index (VIX) — weekly and year-to-date data via Investing.com and TradingView=

2. S&P 500 forward earnings estimates — FactSet / consensus analyst estimates

3. EIA Short-Term Energy Outlook, March 10, 2026; WTI and Brent crude pricing data via Barchart and OilPrice.com

4. U.S. Bureau of Labor Statistics — Employment Situation Report, February 2026

5. International Energy Agency — Strait of Hormuz oil flow estimates

State of Capital — What’s Actually Happening

Here’s what most people are missing right now: the market isn’t just moving, it’s rotating.

The S&P 500 Energy sector is up more than 25% year-to-date. That’s not a small move. That’s a massive repricing of an entire sector. And energy isn’t the only one running: materials, industrials, consumer staples, real estate, and financials have all been putting up strong numbers too.

Meanwhile, the growth names that dominated your timeline for the last few years? They’re lagging. Value is beating growth. And here’s the part that might surprise you even more: U.S. stocks are trailing international markets. European and Asian equities have been stronger on a year-to-date basis.

So what does all of this tell us?

That nobody (no matter how confident they sound on a podcast) knows ahead of time which sector or which region is going to lead in any given year. If your portfolio is concentrated in one area, you feel the rotation fast. Diversification sounds boring until it’s the reason you’re still sleeping at night.

On the bond side, the 10-year Treasury yield dropped below 4% for the first time in a while. If you’ve been wondering why mortgage rates, auto loans, and credit card rates have come down slightly, that’s the reason.

Corporate earnings were strong in Q4 and throughout 2025. The global economy is still on solid footing.

The real issue right now isn’t weakness. It’s that nobody knows what’s coming next. And that uncertainty is showing up everywhere.

Policy & Economics

Why Energy Is Back in the Spotlight

Over the weekend, things got real. The United States and Israel conducted coordinated strikes on Iran. Markets reacted immediately, especially in the energy space.

The big concern here is the Strait of Hormuz. It’s a narrow shipping lane, and roughly 20% of the world’s oil supply passes through it. With tensions rising, shipping captains have already started rerouting vessels. Insurance companies are reconsidering coverage for ships in the region.

And that alone can push prices higher—even before there’s an actual supply disruption.

If oil crosses $100 per barrel, the ripple effects hit fast. Higher gas prices at the pump. Increased heating costs (and we’re still in winter). More expensive transportation for goods. And renewed inflation pressure across the board.

Keep in mind: almost everything you buy gets to you by truck, train, or boat. In a world already dealing with tariffs, lingering post-COVID inflation, and fragile supply chains, an energy shock amplifies everything.

This is exactly why real assets have been attracting capital lately. Energy, gold, silver, real estate, infrastructure, commodities have been rallying not just because demand is up, but because investors are hedging against uncertainty. When people don’t know what’s coming, they tend to move toward things they can see and touch.

The Breakdown

How Retirement Accounts Can Lower Your Tax Bill Today

Let’s talk about one of the most underused tax strategies out there. It’s not complicated. It’s not some loophole. It’s just... using your retirement accounts the way they were designed.

When you contribute to a traditional 401(k) or IRA, that money comes off your taxable income for the year. Meaning you could owe less in taxes right now while also building toward your future.

So you’re lowering your tax bill today and giving your money time to grow and compound over decades. That compounding piece is where real wealth gets built. Not overnight. Not from one hot stock. From time.

Now, there’s a tradeoff. This money is meant for retirement. If you pull it out early, you’ll likely face penalties and taxes. So don’t put money in here that you might need next year for rent or a car repair.

But for long-term savings? We’re big fans of these accounts.

They create discipline. They reduce your taxable income. And they let your investments grow without getting eaten alive by taxes every year.

None of that is flashy. Nobody is making viral content about maxing out a 401(k). But it works. And the people who start early and stay consistent are the ones who end up with real options later in life.

The Conversation

Keep It Simple

Weeks like this are a good reminder of something we come back to a lot:

• We don’t control geopolitics.

• We don’t control where the market rotates next.

• We definitely don’t control whether international stocks outperform domestic ones.

What we do control is whether we stay disciplined when things get noisy.

Staying diversified. Rebalancing when the numbers call for it. And making decisions based on your actual goals instead of whatever headline is trending.

Markets will always move. That’s what they do. A well-structured plan is built to move with them, not react to every tremor.

Closing Thought

Every week there’s a new reason to second-guess your plan. This week it’s Iran and oil prices. Next week it might be tensions in Cuba or something else. The noise never stops.

But here’s what we keep coming back to: the basics work. Diversify. Use your retirement accounts. Don’t try to outsmart the market on a Tuesday afternoon because of a headline. The boring stuff is boring because it works slowly. And slow is how real wealth actually gets built.

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Sources

1. S&P Dow Jones Indices, S&P 500 Energy Sector Index performance data, as of February 27, 2026. S&P Global.

2. S&P 500 sector performance and market rotation data, February 2026. Bloomberg, FactSet.

3. FactSet Earnings Insight, Q4 2025 S&P 500 earnings season results (96% of companies reporting, 14.2% blended earnings growth rate), February 2026.

4. U.S. Treasury Department, Daily Treasury Yield Curve Rates, February 2026. 10-year yield fell below 4% on February 27, 2026.

5. CNBC, “10-year yield falls below 4% on stagflation risk as producer prices heat up,” February 27, 2026.

6. U.S. Energy Information Administration, “Amid regional conflict, the Strait of Hormuz remains critical oil chokepoint,” 2025. Approximately 20 million barrels per day, or ~20% of global petroleum liquids consumption.

7. 2026 Israeli–United States strikes on Iran, multiple sources including CNN, NBC News, UN News, February 28–March 2, 2026.

8. IRS.gov, “401(k) Plans” and “Traditional and Roth IRAs” — tax-deferred contribution rules and early withdrawal penalties.

What are real assets? Think real estate, infrastructure (things like toll roads, power grids, and energy networks), and commodities (oil, gold, agricultural products). Physical stuff the economy runs on.

Vince leads the team that decides how to invest across all of these categories. We’re talking about a firm that manages over $93 billion for some of the biggest institutional investors on the planet—pension funds, university endowments, and sovereign wealth funds.

The conversation was supposed to be about careers. It turned into something much bigger.

State of Capital

Why the Biggest Investors in the World Own Things You Can Touch

When most people think about investing, they think about buying stock in companies like Apple or Tesla. But the largest, most sophisticated investors in the world? A big chunk of their money goes into physical things: buildings, roads, energy infrastructure, natural resources.

That’s what Cohen & Steers specializes in. The firm was founded in 1986, is publicly traded on the New York Stock Exchange, and has offices in six countries. They were one of the first to create a mutual fund focused on real estate, and they’ve spent nearly 40 years becoming one of the top firms in this space globally.

Vince has been at the firm since 2013, leading the team that allocates money across these different types of real assets. Before that, he managed over $2 billion in similar strategies at another major firm called AllianceBernstein.

Here’s why this matters for you: the investments that get the most attention on social media and the news aren’t necessarily the ones that the biggest, most experienced investors rely on. There’s a gap between what’s popular and what’s actually anchoring the portfolios that manage retirement money for millions of people. Understanding that gap is a big part of becoming a smarter investor.

Policy & Economics

Why Real Assets Are Getting More Attention Right Now

You don’t have to look far to see why real assets are part of a bigger conversation right now.

When prices go up across the economy (inflation), it eats into the value of a lot of traditional investments. If you own stock in a company that’s promising big profits five years from now, inflation makes those future profits worth less today. That’s a problem.

But real assets work differently. If you own an apartment building, rents tend to go up with inflation. If you own a toll road, the tolls go up. If you own commodities like oil or gold, their prices tend to rise when everything else gets more expensive too. These investments are tied to real, physical demand not just promises about the future.

Right now, we’re in an environment where inflation is sticking around longer than most people expected, interest rates are higher than they’ve been in years, and the stock market is heavily concentrated in a handful of big tech companies. That kind of concentration is risky. If those few companies stumble, portfolios that aren’t diversified could take a big hit.

That’s exactly the kind of environment where real assets become more valuable…not as a trend, but as protection.

This also connects to what we talked about last week: new policy could open the door for your 401(k) to invest in strategies like these for the first time. Understanding how professional investors think about real assets is becoming directly relevant to your own retirement savings.

The Breakdown

The Career Behind the Capital

Before Vince was leading a multi-billion-dollar investment team, he was grinding through the early years like everyone else.

He started as an associate at Houlihan Lokey, a firm known for complex financial advisory work—the kind of job where you build a foundation in analysis and problem-solving that stays with you. From there he moved to AllianceBernstein, where he worked his way up from junior roles to co-managing over $2 billion. He earned his CFA (one of the hardest professional designations in finance) and his MBA from Carnegie Mellon while raising a family at the same time.

None of that happened fast. None of it was glamorous. But all of it compounded over time.

That was the part of the conversation that hit hardest for the students in the room.

We live in a world that celebrates overnight success and going viral. Vince’s career is the opposite of that. He picked an area most people overlook—real assets—and spent over a decade and a half building the kind of deep expertise that institutions now depend on.

He didn’t chase what was trendy. He got really good at something that matters.

For students, the lesson: build skills that grow over time, not just credentials that look good on paper.

For investors, the same idea applies: the managers worth trusting aren’t the loudest ones. They’re the ones who’ve been doing the work, consistently, for a long time.

The Conversation

Why Access to These Conversations Matters

Here’s something that’s always frustrated me: the people managing the most money in the world almost never talk to everyday people. That knowledge stays behind closed doors—in boardrooms and institutional meetings that regular investors and students never get invited to.

That’s what made this event special. It wasn’t about stock picks or market predictions. It was about giving students and our community a window into how the professional investment world actually works: how careers are built, how firms are structured, and how decisions get made at scale.

Financial education shouldn’t stop at “what’s a 401(k)?” It should include understanding the broader landscape—the firms, the people, the asset classes, and the thinking that shapes how capital moves. That context is what separates informed investors from everyone else.

The full conversation with Vince is now live on this week’s episode of Invested In Us. Whether you’re a student figuring out your career, someone trying to understand investing better, or both—it’s worth a watch.

Closing Thought

You don’t learn about money from textbooks. You learn from the people who actually do it.

I’m grateful to Vince Childers for sitting down with our students and our community. Conversations like this don’t happen often enough, we’re going to keep working to change that.

More to come.

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Sources

1. Cohen & Steers, Inc. Preliminary AUM Report, January 31, 2026 ($93.1B)

2. Cohen & Steers Corporate Overview, Founded 1986, NYSE: CNS

3. Vince Childers, CFA — SVP, Head of Real Assets Multi-Strategy, Cohen & Steers

4. Sacred Heart University, Live Guest Speaker, February 2026

But something is happening, it’s just not showing up in the index. More and more of the companies driving real growth are choosing to stay private longer, raising billions before everyday investors ever see a ticker symbol. That means the wealth is being created before most people get access to it.

This week, we’re breaking down what that means, why it matters, and what’s actually changing.

State of Capital

The S&P 500 finished the week basically flat, continuing a sideways pattern we’ve been watching for several weeks now. But flat doesn’t mean nothing is going on.

Under the surface, capital is rotating. Energy continues to lead by a wide margin. Materials, industrials, and real estate are all showing strength. Small-cap stocks (tracked by the Russell 2000) are up mid-to-high single digits year to date and are actually outperforming the big indexes.

Meanwhile, the mega-cap tech names that dominated for the last few years? They’re consolidating. Not crashing, just pausing.

This isn’t people pulling money out of the market. It’s money moving around the market, finding new places to go. That’s a meaningful difference, and it tells you something about where investor confidence is actually sitting right now.

Policy & Economics

From Public to Private—and Why It Matters for You

For a long time, the path to building wealth through the stock market was straightforward: companies go public, you buy shares, you participate in the growth.

That path is narrowing.

Over the past two decades, companies have increasingly delayed or skipped going public altogether. They raise billions in private funding rounds, grow for years, and by the time a ticker symbol shows up on your screen, a huge chunk of the value creation has already happened.

Since 2021, higher interest rates and tighter conditions have slowed IPO activity even further. There was a modest pickup in 2025, but we’re still well below historical norms.

The reasons are real: going public is expensive, scrutiny is intense, and founders increasingly prefer patient capital that lets them build without the pressure of quarterly earnings calls.

Now here’s where it gets interesting from a policy standpoint.

The administration has floated proposals to ease quarterly reporting requirements for some public companies—potentially moving to semi-annual reporting. Less paperwork, sure. But also less transparency for investors. That’s a trade-off worth watching.

More significant: there’s been executive action that would allow retirement plans—your 401(k)—to allocate into private investment strategies like private equity, real estate funds, and hedge funds. Historically, that kind of access was reserved for pensions and big institutional money. Not individual retirement accounts.

There’s currently more than $12 trillion sitting in defined-contribution retirement accounts in the U.S. Even a small percentage moving into private assets would redirect an enormous amount of capital. If that actually plays out, it could reshape how everyday portfolios are built across the country.

The Breakdown

Access Is Expanding. But Access Alone Isn't Enough.

Let’s be real about what private markets offer—and what they don’t.

The performance numbers are compelling. Over the last 25 years, private equity has generated estimated net annualized returns of roughly 13%, and data from MSCI and Cliffwater shows persistent outperformance versus public benchmarks.

Part of that comes from how private assets are valued (less frequently, which smooths out volatility on paper). But the more durable part comes from what private investors actually do: operational improvements, strategic acquisitions, disciplined exits. It’s hands-on ownership, not passive holding.

That said, private markets carry real risks that don’t show up in the return numbers. Your money is locked up for years. Valuations are opaque, you can’t just check a price on your phone and getting out early usually isn’t an option.

Here’s the other thing worth paying attention to: as more money flows into private markets, it’s concentrating in the biggest asset management firms. That’s great for those firms, but in a downturn, that kind of concentration could amplify problems across the system. A lot of capital in very few hands.

The flipside? Smaller funds in the lower and middle market have historically produced some of the strongest returns: targeting niche industries, overlooked regions, and founder-led businesses at more reasonable prices. Sometimes the less obvious door is the better one.

None of that is flashy. Most of it isn’t even interesting to talk about at dinner, but it works.

We focus less on predictions and more on process for exactly this reason. The prediction game is fun until it’s wrong (and it’s wrong a lot). Process is what carries you through the full cycle.

The Conversation

This is one of those moments where the investing landscape is genuinely changing, not just cycling.

For decades, public markets were the way regular people built long-term wealth. That’s still true, but it’s becoming incomplete. Private markets are growing faster, attracting more capital, and now policy is actively opening the door wider.

That’s a good thing, as long as people walk through that door with the right information. The worst version of this is people chasing returns in asset classes they don’t fully understand because someone told them it’s what the wealthy do. The best version is informed investors adding thoughtful, well-sized private allocations that complement what they already own.

The difference between those two outcomes is education. Which is exactly why we do this.

Closing Thought

The wealthiest investors have always had access to private markets. What’s changing is that access is no longer limited to them.

But access without understanding is just a new way to take on risk you didn’t plan for. The opportunity is real. So is the responsibility to know what you’re getting into before you get into it.

Stay curious. Stay informed. That’s how you make access actually work for you.

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Sources

1. S&P Dow Jones Indices, S&P 500 Sector & Index Performance, Feb. 13, 2026

2. FTSE Russell, Russell 2000 Index Data, Feb. 2026

3. MSCI Private Capital Performance Data; Cliffwater Direct Lending Index, 2000–2025

4. U.S. Department of Labor, Executive Action on Retirement Plan Allocations, 2026

5. Investment Company Institute, Defined-Contribution Plan Asset Data, 2025

6. National Bureau of Economic Research, IPO Pipeline and Issuance Trends, 2021–2026

But here’s the part that didn’t make most headlines: roughly 93% of U.S. stock market wealth is held by the top 20% of households. So when we celebrate a market milestone, we should probably ask—who is it a milestone for?

That’s not a reason to be cynical. It’s a reason to pay closer attention to what’s happening underneath the number. And what’s happening underneath is actually pretty interesting right now.

State of Capital

For the first time in a while, the gains aren’t being carried by a handful of mega-cap tech names. The rally is spreading out.

Smaller companies (tracked by the Russell 2000) are up about 7.6% so far this year. Energy and consumer staples are leading. Even “equal-weight” versions of the S&P 500—where every company counts the same regardless of size—are hitting record highs. The S&P 500 itself is up about 1.4%.

Why does that matter?

When a small group of stocks is doing all the heavy lifting, markets are fragile. One bad earnings report from the wrong company and the whole thing wobbles. But when more sectors and more companies are contributing, the foundation gets sturdier. That’s what we’re seeing now, and it’s a healthier setup for long-term investors than what we’ve had in recent years.

Meanwhile, the 10-year Treasury yield is sitting around 4.21%. That number matters because it touches everything from mortgage rates to how investors value future earnings. It’s been creeping up, reflecting ongoing uncertainty around inflation, government spending, and global capital flows.

On the surface, things look steady. But underneath, money is moving around more deliberately than the headlines suggest

Policy & Economics

You can’t talk about markets right now without talking about the debt picture, so let’s talk about it.

The U.S. is approaching $39 trillion in national debt. Annual tax revenue comes in around $5 trillion. Annual spending is closer to $7 trillion. That’s a $2 trillion gap, every single year, and it keeps compounding.

That gap ripples outward. It affects how much the government has to borrow, how bond markets price risk, and where interest rates land over time. Layer in the ongoing political negotiations, funding debates, and global uncertainty and you get a policy environment that feels... unresolved.

One thing worth watching: central banks around the world have been increasing their gold reserves. That’s not a panic move or a short-term trade.

It’s a long-term signal about how major institutions are thinking about currency risk, confidence, and diversification. When the people who manage sovereign wealth start repositioning, it’s worth paying attention to why.

In this environment, interest rates become the anchor point for almost everything else—mortgages, loans, business valuations, and your long-term financial plan.

The Breakdown

Let’s come back to that stat from the top: 93% of stock market wealth, held by 20% of households.

That’s not a reason to avoid the market. It’s actually the opposite. It’s a reason to get in and stay in (with a real plan).

Markets don’t automatically create financial security. Record highs don’t mean everyone’s winning. But the gap between people who build wealth over time and people who don’t usually comes down to a few boring, repeatable things: saving consistently, staying invested through uncomfortable periods, understanding what you actually own and why, and having a plan built for your real life rather than some hypothetical perfect market.

None of that is flashy. Most of it isn’t even interesting to talk about at dinner. But it works.

We focus less on predictions and more on process for exactly this reason. The prediction game is fun until it’s wrong (and it’s wrong a lot). Process is what carries you through the full cycle.

The Conversation

This is a good moment to zoom out.

Yes, the Dow hitting 50,000 is exciting. Yes, volatility will come back and it’ll feel uncomfortable when it does. Both things can be true at the same time.

What’s encouraging right now is the broadening. When more of the market participates, it means the rally has legs beyond just a few names. That’s more durable than what we’ve seen in the last couple of years.

It’s also worth noting that markets outside the U.S.—parts of Asia, parts of Europe—have started outperforming. Opportunity isn’t limited to one country or one index. The investors who do well over full cycles tend to think globally, not just domestically.

Cycles change. Leadership rotates. That’s not something to fear. It’s something to build for.

Closing Thought

The Dow at 50,000 doesn’t eliminate risk. It just changes where the risk is hiding.

And the real question isn’t “what should I do now that the market hit a big number?” It’s “does my plan still work regardless of what number the market is at?”

If the answer is yes, you’re in good shape. If the answer is “I don’t actually have a plan”, that’s what we’re here for.

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Sources

1. Dow Jones Industrial Average milestone reporting, major financial media, February 2026.

2. S&P Dow Jones Indices and Russell Index data, February 6, 2026.

3. NYU / NBER research on U.S. wealth and equity ownership concentration.

4. U.S. Treasury and Congressional Budget Office fiscal data, 2025–2026.

5. International precious metals pricing data, February 2026.

6. MSCI and regional equity index performance reports, early 2026.

State of Capital

Markets continue to operate in a more cautious and selective environment.

While headline indices remain resilient, leadership beneath the surface is shifting in meaningful ways. Broad participation is slowly returning after an extended period of narrow, mega-cap dominance—an important signal for long-term investors.

As of January 31, 2026, the S&P 500 gained approximately 1.5%. Small-cap stocks, represented by the Russell 2000, experienced their weakest week since October, despite remaining up roughly 5% over recent months. Energy and telecommunications led performance, while the 10-year Treasury yield quietly moved higher to approximately 4.22%.

This is what a rotation environment looks like. Leadership is changing, correlations are adjusting, and capital is being forced to reallocate more thoughtfully.

Policy & Economics

Interest rates remain the foundation of today’s market narrative.

The Federal Reserve held rates steady at its most recent meeting, a widely expected outcome. However, markets continue to debate the timing and likelihood of future rate cuts. Policy uncertainty remains elevated, and confidence in long-term central bank credibility is increasingly important.

Recent discussion surrounding Kevin Warsh’s nomination to the Federal Reserve has added another layer of complexity.

His emphasis on balance sheet discipline and currency stability has reinforced investor focus on monetary credibility, while political scrutiny of Federal Reserve governance continues to introduce uncertainty around leadership transitions.

At the same time, precious metals experienced heightened volatility. Gold and silver declined sharply late in the week, marking one of their weakest sessions in decades. Despite this, both remain meaningfully positive year-to-date—reflecting the push and pull between inflation hedging and shifting rate expectations.

In this environment, stability and credibility matter.

The Breakdown

At its core, investing is about ownership.

A stock represents a claim on a real business. Nothing more. Nothing less.

During this week’s Breakdown, we used a simple lemonade stand example to explain how ownership works—from a single owner enjoying all the profits to millions of shareholders participating in the growth of a global company

When you buy a stock, you are purchasing a stake in that business.

The company can either distribute profits to owners or reinvest them to compound long-term value. Both paths can be effective, depending on your objectives.

This is why successful investing must always align with risk tolerance, time horizon, income needs, and long-term goals. When investments are disconnected from those fundamentals, unnecessary risk is introduced.

Professional investors do not succeed by chasing headlines. They succeed by managing risk, rebalancing intentionally, and maintaining patience through cycles.

The Conversation

Markets remain investable, but the margin for error is narrowing.

Leadership is rotating. Policy risk is rising. Volatility is returning.

In environments like this, capital preservation and risk management are just as important as return generation. Diversification matters more than momentum, discipline matters more than predictions, and process matters more than noise.

At NJK Partners our focus remains on helping families build resilient portfolios designed for real life, not just strong markets.

Closing Thought

Calm markets can be misleading. The real work happens underneath.

Periods of rotation and uncertainty aren’t signals to step away—they’re signals to get clearer. Clearer about risk. Clearer about priorities. Clearer about what actually matters over a full market cycle.

The investors who do best aren’t louder or faster. They’re prepared.

Stay grounded. Stay intentional. Let’s continue building together.

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Sources
1. S&P Dow Jones Indices, S&P 500 Sector & Index Performance, Jan. 2026
2. FTSE Russell, Russell 2000 Index Data, Jan. 2026
3. U.S. Department of the Treasury, Daily Yield Curve, Jan. 31, 2026
4. Federal Reserve, FOMC Statement, January 2026 Meeting
5. World Gold Council; London Bullion Market Association, Jan. 2026
6. Bloomberg; Wall Street Journal, Federal Reserve Nomination Coverage, 2026

Below, we break down what we’re watching across capital markets, policy and economics, and how we think about portfolio construction in this environment.

State of Capital

U.S. equities were largely unchanged this week. The S&P 500, which represents the 500 largest publicly traded companies in the United States and where most everyday investors have exposure, finished the week roughly flat and is up just over 1% year-to-date.

Beneath the surface, leadership continues to rotate.

• Industrials and metals are among the strongest performers, up over 8% year-to-date as of Friday’s close.

• Energy has also outperformed, up nearly 7% year-to-date, supported by strong cash flows and disciplined capital spending.

• Gold rose approximately 6.5% year-to-date, reflecting continued allocation by global central banks as geopolitical tensions rise and questions around U.S. policy stability resurface.

We view gold’s performance as notable. Central banks have been shifting toward precious metals for several years, and recent developments—including escalating tariff rhetoric involving NATO partners and renewed debate around Federal Reserve independence—have reinforced this trend.

Real assets more broadly continue to perform well. Historically, real assets have served as effective inflation hedges, as their value and cash flows are often linked to long-term contracts with built-in pricing escalators. This characteristic becomes particularly valuable during periods when growth-oriented equities—such as large-cap technology—lose momentum.

From an income perspective:

• Real estate is currently yielding approximately 3.7%

• Energy is yielding roughly 3.2%

• By comparison, the S&P 500 dividend yield is near 1.2%

For investors seeking a combination of cash flow, downside protection, and long-term upside, these spreads are increasingly attractive.

Bond yields ticked higher this week amid concerns around potential political interference with monetary policy, renewed geopolitical tensions, and what markets have begun to frame as a broader “sell-America” trade. We are monitoring this closely, as further escalation could continue to benefit real assets—particularly precious metals.

Policy & Economics

Housing policy is once again moving to the center of the political debate.

The current administration has signaled potential price controls—an economic term referring to government-imposed ceilings or floors—by threatening to limit large institutional investors from acquiring single-family homes.

While we believe the intentions are well-meaning, particularly around improving affordability for individual buyers, we view this approach as populist policy that may produce unintended consequences.

The fundamental issue in U.S. housing is supply, not demand.

Limiting institutional participation may reduce competition in certain markets in the short term. However, over the long term, it risks reducing the incentive to build new inventory, particularly in regions where development costs are already elevated.

Several structural factors continue to constrain housing supply:

• High construction costs, driven by elevated prices for materials such as metals, lumber, and other commodities

• Tariffs and supply-chain shifts, which raise input costs

• Labor shortages, exacerbated by immigration policy and a shrinking skilled-trade workforce

• Over-regulation, particularly in the Northeast, where zoning, permitting, environmental reviews, and public approvals can delay projects for years before revenue is generated

From a capital-allocation perspective, investors require the ability to earn a risk-adjusted return. When that becomes infeasible, capital moves elsewhere—and housing supply tightens further.

Most credible estimates suggest the U.S. is short 3 to 6 million housing units. In our view, long-term affordability will require policies that incentivize development, not discourage the investors with the balance sheets necessary to fund it.

The Breakdown: How We Think About Investing

When we think about investing, we generally divide the world into four core asset classes. This framework isn’t academic—it’s practical.

1. Cash (Short-Term Paper)

Cash includes anything that can be converted into liquidity in under roughly nine months.

Think:

• Checking and savings accounts

• Money market funds

• Short-term CDs

Cash provides flexibility and safety, not growth. It’s about optionality and resilience.

2. Stocks (Equity Ownership)

Stocks represent ownership in a business.

If a lemonade stand has:

• One owner → one share

• One million owners → one million shares

When the business performs well, profits can be distributed or reinvested, increasing the value of each share. Stocks allow investors to participate in long-term growth.

3. Bonds (IOUs)

Bonds are loans.

If that same lemonade stand wants to grow without giving up ownership, it can borrow capital and promise:

• Periodic interest payments

• Repayment of principal

Bonds tend to offer more predictability, though typically with lower upside than equities.

4. Alternative Investments

This category includes assets outside traditional public markets.

Examples include:

• Real estate

• Private businesses

• Private equity

Alternatives often emphasize long-term ownership and cash flow, with less day-to-day volatility—but also less liquidity.

The Conversation: Portfolio Construction

We believe a healthy portfolio includes a thoughtful mix of all four asset classes.

There is no universal allocation. The right structure depends on:

• Risk tolerance

• Time horizon

• Personal objectives and preferences

The objective is not perfection—it’s diversification, balance, and discipline.

Markets evolve. Policy shifts. Life changes.

A portfolio should be intentionally constructed, not reactively assembled.

Closing Thought

Markets remain investable, but the margin for error is narrowing. Leadership is rotating, policy risk is rising, and diversification matters more than momentum.

In environments like this, capital preservation and risk management are just as important as return generation.

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Watch Episode 2 of Invested Of Us

U.S. equities delivered another strong year in 2025. The S&P 500 finished up 16.4%, marking the third consecutive year of double-digit gains, despite significant volatility early in the year.¹ That volatility peaked around what the administration referred to as “Liberation Day,” when broad tariffs were announced across nearly every major U.S. trading partner.

Following those announcements, markets declined sharply before rebounding more than 40% from the trough, as investors refocused on fundamentals rather than headlines.² Corporate earnings across multiple sectors remained resilient, reinforcing confidence that profit growth—not politics—continues to anchor valuations.

Historically, equity markets rarely post four consecutive years of double-digit returns. Still, given deregulatory momentum, recent tax-code changes, and stable corporate profitability, another positive year remains plausible—though risks are rising beneath the surface.

Where We See Opportunity

Technology & AI-Driven Infrastructure

Technology has led the rally and remains a long-term allocation focus, particularly if interest rates decline.

Beyond software and platforms, we continue to favor real-asset beneficiaries of artificial intelligence, including data centers, power infrastructure, and connectivity assets, which underpin AI deployment at scale.³

Energy & Natural Gas

The AI build-out is energy intensive. This has renewed interest in natural gas and midstream energy infrastructure, which support data centers and industrial expansion while offering contractual cash flows and inflation-linked characteristics.⁴

Residential Real Estate (Selectively)

Housing remains structurally undersupplied. Estimates suggest the U.S. faces a shortage of approximately 3–6 million housing units, placing persistent upward pressure on prices and rents.⁵ While affordability challenges remain acute—particularly for first-time and lower-income buyers—the supply-demand imbalance continues to support long-term fundamentals.

Precious Metals

We remain constructive on gold and precious metals, which have performed well in recent years. Central banks globally continue allocating to gold, and we see little evidence that this trend is slowing. In an environment marked by geopolitical instability, inflation uncertainty, and unpredictable policy, hard assets often reassert their role as stores of value.⁶

Key Risks We’re Monitoring

Bond Markets & Central Bank Independence

We are closely watching the bond market. Historically, investor confidence has relied on central bank independence, allowing monetary policy to be guided by data rather than political pressure. Central banks have two mandates—managing inflation and employment—and two primary tools: interest rates and money supply.

Given record U.S. debt levels and persistent fiscal deficits, we expect fixed income markets to remain volatile, even if rate cuts materialize.⁷

Policy, Courts, and Fiscal Uncertainty

This week, markets are monitoring a potential Supreme Court ruling related to Trump-era tariffs. Any outcome that introduces uncertainty around tariff repayments could spill over into Treasury markets.

We are also watching the possibility of a federal government shutdown later this month, which—while often temporary—can amplify short-term market stress, particularly in credit markets.⁸

Portfolio Perspective

• We remain overweight U.S. equities, favoring businesses with strong cash flows and pricing power.

• We are cautious on long-duration fixed income, given fiscal pressures and policy uncertainty.

• We are closely monitoring short-term fixed income, particularly in the context of potential rate changes.

• Above all, we emphasize diversification. In this environment, it is easy to make money—but equally easy to lose it.

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Closing Thought

While conditions support continued growth into 2026, the foundation is fragile. High debt levels, entrenched deficits, political uncertainty, and bond market sensitivity leave little margin for error.

Markets may continue to climb—but risk management matters more than momentum.

1. S&P Dow Jones Indices, S&P 500 Total Return Data
2. Bloomberg, S&P 500 drawdowns and recoveries (2025)
3. McKinsey Global Institute; CBRE Research, Global Data Center Outlook
4. U.S. Energy Information Administration (EIA), Natural Gas Markets
5. Freddie Mac; National Association of Realtors; U.S. Census Bureau
6. World Gold Council, Central Bank Gold Reserves
7. Congressional Budget Office (CBO); U.S. Treasury
8. U.S. Office of Management and Budget; Bloomberg Government

The divergence between equity markets and fiscal fundamentals is stark. On one hand, deregulation and tax incentives have propped up earnings despite softer macro data. On the other, U.S. federal debt is now in the $37 trillion range, with the debt-to-GDP ratio estimated at or exceeding 124%.² ³ That ratio underscores both how aggressive capital markets are acting and how delicate the fiscal base has become.

Debt service is rising rapidly. Interest payments now approach the scale of big-ticket federal programs, narrowing the room in budgets. With nearly $10 trillion in U.S. debt held by foreign investors, questions about external demand grow sharper.⁴ Add in the specter of a potential government shutdown, and short-term political risk can amplify long-term structural vulnerabilities.

Beyond Equities: Bond Market Risks

Historically, fixed income has been the safe harbor when equities stumble. But with debt-to-GDP near record levels, deficits entrenched, and interest obligations rising, bond investors must tread carefully. We continue to favor high-quality investment-grade debt, but remain skeptical that the Federal Reserve will deliver aggressive rate cuts in the near term, given inflation stickiness and fiscal overhang.⁵

Housing: A Structural Shortage

New home sales reached 800,000 units (seasonally adjusted annual rate) in August 2025, significantly above consensus expectations of ~600,000.⁶ The median new home sale price in the same period was $413,500.⁷

To put it in perspective: in 2000, median household income was about $32,020, while the median home price stood at ~$166,994 (≈5× income). Today, with median income closer to $48,648 and median new home price at $413,500, the multiple has widened to over 8× income. Without major intervention, affordability gaps are likely to persist. Public REITs show modest gains (~5% YTD), but many carry exposure to weaker office/retail segments, which may act as drag.

Policy, Growth, and Markets

The U.S. workforce remains around 150–160 million people, with unemployment under 5%. Yet GDP growth is decelerating: estimates place 2025 near 1.7%, down from ~2.8% in 2024.⁸ If fiscal instability or political gridlock spills into credit markets—especially under a shutdown scenario—the repercussions may cascade into both equities and fixed income.

Real Assets as Anchors

In a world of policy noise and rising liabilities, real assets retain appeal. Housing shortages demand new stock. Energy infrastructure and inflation-linked cash flows help guard against eroding purchasing power. Precious metals, especially gold and silver, continue to trade near highs as investors seek durable value in a shaky landscape.

Investor Perspective

Equity returns may appear robust, but the fiscal foundation is under stress. Debt servicing now stakes claim on a large share of federal receipts, housing affordability continues to deteriorate, and policy uncertainty—compounded by the looming possibility of a shutdown—introduces latent risk. While equities can ride momentum, the warning signs in credit markets are growing louder.

This Week’s Takeaway

“Equities are celebrating, but fiscal math tells a different story. With a potential shutdown looming, resilience requires selective positioning, attention to debt dynamics, and real assets as ballast.”

Community Spotlight: Financial Literacy Month

October is National Financial Literacy Month — a moment to emphasize how foundational financial knowledge is for community resilience. Recent data underscores the need:

• 57% of U.S. adults cannot correctly answer basic questions on interest rates, inflation, or risk diversification.

• Two-thirds of households report living paycheck-to-paycheck, with little buffer for emergencies.

• Young adults (18–24) carry average student loan burdens exceeding $30,000.

• Latino and Black households remain disproportionately excluded from mainstream financial services, despite being among the fastest-growing economic cohorts.

At NJK, financial literacy is not merely an initiative — it’s mission-critical. Through Piggy Bank University and community programs, we aim to arm the next generation with tools to weather uncertainty, manage risk, and build lasting prosperity.

Bottom line: knowledge is leverage. Closing the financial literacy gap may well be the most powerful form of impact investment we can make.

Footnotes

1. Market performance—S&P, sector gains, Russell 2000 — cited internally from your data.

2. U.S. National Debt ~ $37 trillion — see Treasury / Fox Business reporting.⁴

3. Debt-to-GDP ~124% — supported by Trading Economics projections and Wells Fargo commentary.² ³

4. Foreign holdings and interest pressures — general debt structure disclosures.

5. Fiscal overhang and rate outlook — commentary in public debt analyses.

6. New home sales ~800,000 (SAAR) in August 2025 — U.S. Census / HUD.⁶

7. Median new home price $413,500 — U.S. Census / HUD.⁷

8. Growth estimates for 2025 vs. 2024 — consensus macro forecasts (internal data).

As of September 12, the S&P 500 has risen nearly 13% year-to-date, driven by strength in a handful of sectors and sustained corporate earnings despite weakening macro data. Telecommunications has been the clear leader, advancing almost 25% YTD. Healthcare, by contrast, has barely broken even (+1.3% YTD) and remains down more than 9% over the trailing twelve months, entering what many would define as bear market territory.¹

The divergence is striking. Telecommunications has benefitted from a confluence of fiscal and structural tailwinds. The One Big Beautiful Bill Act has provided extraordinary tax incentives, including 100% bonus depreciation and favorable treatment of domestic R&D, effectively lowering the cost of capital for a sector that is both infrastructure-heavy and innovation-dependent.² At the same time, secular demand for digital connectivity continues to accelerate: 5G adoption, fiber buildouts, and cloud-driven bandwidth consumption are forcing sustained capital investment. Investors, confronted with uncertainty elsewhere, have rewarded telecom’s relatively predictable revenue streams—media rights, long-dated naming contracts, luxury suites, and season tickets—all of which carry inflation-linked step-ups and multi-year visibility.

Healthcare tells the opposite story. Pressured by reimbursement risk, drug pricing debates, and weak sentiment, the sector has underperformed. Yet beneath the near-term malaise lies structural growth. An aging demographic base, advances in biotech, and the integration of artificial intelligence into diagnostics and drug discovery point toward significant long-term upside. For investors with patient capital and tolerance for volatility, today’s discounted valuations may represent a rare entry point.³

Beyond the US: Global Equity Breadth

While the S&P’s performance has been strong, it has not been exceptional relative to global peers. European equities, Japanese markets, and Asia-Pacific ex-Japan have all outperformed year-to-date.⁴ Emerging markets, often overlooked, have quietly delivered superior risk-adjusted returns on the back of capital inflows, cheaper valuations, and differentiated growth profiles.⁵ This breadth matters. It signals that 2025 is not solely a “U.S. exceptionalism” story; rather, global capital is diversifying across regions where policy clarity and valuation discounts create fertile ground.

Corporate Earnings and the Path to 7,000

Despite decelerating job growth, corporate earnings remain robust. Many companies continue to surprise to the upside, aided by deregulation across industries and a more predictable tax structure. While consensus expects S&P earnings to decelerate from double-digit growth, it is plausible that equity indices could push past 7,000 over the next twelve months, particularly if productivity enhancements from AI continue to flow through the economy.⁶

Tariffs remain the wild card. If policy turns unpredictable, margins could compress. Larger companies have more flexibility to pass costs downstream or restructure supply chains, but the smaller and mid-cap universe could be disproportionately impacted. For now, markets appear to have priced in current tariff regimes.

Policy, Growth, and Rates

The Federal Reserve looms large. Markets currently price in a >90% probability of a rate cut; our assessment is closer to 70/30. Inflation is sticky, particularly in services, and tariff impacts have not been fully realized. The economy expanded at 2.8% in 2024 but is tracking closer to 1.7% in 2025, with current forecasts for 2026 clustered around 1–2%. Growth is slowing, and the jobs data confirm the deceleration.⁷

The 10-year Treasury remains anchored in the low 4% range. However, fiscal uncertainty is acute: Congress must resolve budget negotiations by month-end or pass a continuing resolution. A shutdown or extended impasse would have direct consequences for fixed income markets and potentially alter the Fed’s tone.

Real Assets and Inflation Hedges

Technology continues to lead headline performance, but under the surface, real assets are gaining momentum. Precious metals, particularly gold, remain near all-time highs, and silver has delivered strong YTD gains. Energy infrastructure and broader real assets offer investors protection against inflation, attractive yield, and contractual cash flows often tied to CPI step-ups. With estimates showing a shortage of 3–6 million residential units in the United States, real estate remains a long-term structural opportunity.⁸

Investor Perspective

• Headline vs. Reality: Equity returns and earnings look strong, but underlying macro signals—slower job growth, sticky inflation, tariff risks, and fiscal uncertainty—point to fragility.

• Telecommunications: A clear secular winner, buoyed by fiscal incentives and sustained infrastructure demand.

• Healthcare: Near-term laggard, but offers asymmetric long-term upside for investors with patience.

• Real Assets: Provide stability, yield, and inflation protection—an essential ballast in uncertain markets.

• Global Diversification: Outperformance abroad underscores that investors can’t rely solely on U.S. exceptionalism.

• Core Strategy: Position portfolios for durable cash flows, policy alignment, and undervalued sectors with mean reversion potential.

This Week’s Takeaway

“Don’t chase momentum—build resilience with policy tailwinds, real assets, and global breadth.”

Community Spotlight: Hispanic Heritage Month

From September 15 to October 15, we celebrate Hispanic Heritage Month — honoring the contributions, culture, and economic power of Latinos across our nation. The impact is undeniable:

• $4 trillion economy in 2023: the 5th largest in the world if measured independently, bigger than the U.K. or France.

• Latino GDP nearly doubled in just 8 years, from $2.1T (2015) → $4T (2023).

• $4.1 trillion in purchasing power, growing 2.4x faster than the national average.

• $2.5 trillion in consumer spending in 2023 alone (more than double the growth rate of non-Latinos)

• The backbone of the workforce — adding 820,000 working-age individuals in 2023 while the non-Latino population declined.

• With a median age of 31, Latinos are the youngest, fastest-growing part of America’s workforce and future.

Bottom line: Latinos are not just part of America’s story — we are driving its growth, resilience, and prosperity.

Footnotes

1. Reuters, “Struggling U.S. Healthcare Stocks Endure Rough 2025, Draw Some Bargain Hunters” (Aug 7, 2025).

2. WealthManagement.com, “Telecom ETFs Get a Boost from Tax Benefits in the One Big Beautiful Bill Act” (Aug 2025).

3. Reuters, “Struggling U.S. Healthcare Stocks Endure Rough 2025, Draw Some Bargain Hunters” (Aug 7, 2025).

4. JPMorgan Asset Management, “Monthly Market Review” (Sept 2025).

5. Trustnet, “The Funds on Top in Emerging Markets’ Stellar Year” (Sept 2025).

6. Morgan Stanley Global Investment Committee, “A Shrinking Margin for Error,” GIC Weekly (Sept 15, 2025).

7. Bloomberg, “U.S. GDP Growth Tracking 1.7% in 2025 vs. 2.8% in 2024” (Sept 2025).

8. Morgan Stanley Global Investment Committee, “A Shrinking Margin for Error,” GIC Weekly (Sept 15, 2025).

As of September 5, the S&P 500 is up roughly 11% YTD, with the telecommunications sector leading (+24%) while healthcare lags (+1.2%).¹ The Russell 2000—a barometer for smaller-cap equities—is up about 8%, signaling that the rally has broadened beyond mega-cap dominance.

Real assets also continue to attract flows. REITs are up 10% YTD, while precious metals have surged nearly 40% as central banks diversify reserves away from the U.S. dollar.²

Labor Market: Slowing Momentum

August’s jobs report disappointed: analysts expected ~75K new jobs, but the economy produced fewer than 25K, with prior months revised downward.³ This data confirms a cooling labor market despite corporate earnings exceeding forecasts (11% vs. 4%). Executives appear to have adopted a “wait-and-see” posture in the face of tariff policy uncertainty.

The JOLTS survey reinforces this slowdown: post-COVID, job openings reached nearly 2 per unemployed worker; today, that ratio is closer to 1:1.³ While the American consumer remains resilient—two-thirds of GDP is driven by consumption—the slowdown in hiring may dampen confidence if it persists.

Policy Outlook: Fed on Deck

With job growth slowing, the Federal Reserve may see justification for a rate cut at next week’s meeting. A cut, however, primarily impacts the short end of the curve (<5 years), while longer-dated yields remain anchored by global capital flows and mortgage/auto markets.

Still, the risk of stagflation—rising inflation alongside slowing growth—cannot be ignored given tariff pressures and weak labor prints.

Global Signals: Gold, the Dollar, and Real Assets

Gold and other precious metals remain strong as global central banks steadily reduce exposure to the U.S. dollar—a decade-long trend that has accelerated in recent quarters.² The dollar itself has weakened YTD relative to peer currencies, reflecting diminished confidence amid fiscal and policy uncertainty.³

At the same time, traditional U.S. manufacturing has contracted in 2025 despite federal reshoring incentives. Yet capital investment continues to pour into data centers, driven by surging demand from artificial intelligence workloads—one of the clearest secular growth trends for investors.⁴

Investor Perspective: Cycles, Deficits, and Concentration Risk

Markets remain resilient even as macroeconomic textbooks would suggest turbulence:

• A national debt above $34 trillion, with credit rating downgrades over the past 15 years.⁵

• Persistent fiscal deficits, recently widened by tax policy changes.

• Elevated interest rates alongside inflationary pressures.

• Equities continue to shrug off these headwinds thanks to outsized earnings growth (11% vs. 4% expected) and the dominance of the “Magnificent 7.” Yet concentration risk looms: should markets be forced to digest “bad news,” the potential for a short burst of volatility remains acute.²

Photo by Will Colavito on Unsplash

This Week’s Takeaway

Investors face a paradox: strong corporate earnings and durable consumer spending versus weakening job growth and rising policy risks. We continue to see opportunity in real assets, gold, and AI-driven infrastructure, while remaining cautious on traditional manufacturing and sectors vulnerable to tariff shocks.

Community Spotlight: Honoring The Community Amongst Educators

As schools reopen, I’m reminded how much it truly takes a village to raise and support our kids. Teachers, PTAs, janitors, cafeteria staff, main office teams, bus drivers—every single role matters. Here in our own community, the PTA has been a constant example of that collective effort, showing up with creativity, time, and heart to make sure families feel supported.

Watching Fatima serve as PTA President has given me a front-row seat to the kind of unseen work that makes schools run smoothly—organizing events, rallying volunteers, bridging parents and staff. But it’s not just one person; it’s hundreds of hands and hearts working together.

Those efforts don’t just support students; they strengthen families, neighborhoods, and the foundation of our broader economy. At NJK, we call this the family economy ecosystem—the everyday network of people, businesses, and institutions that make families stronger. Schools sit right at the center of it, reminding us why investing in community matters so much.

To every member of the school community: thank you. Your impact extends far beyond the classroom, and we’re deeply grateful.

Footnotes

1. AP News, “Markets at Record Highs as August Jobs Data Looms” (Sept 5, 2025).

2. MarketWatch, “AI Bubble and Gold Surge Drive Diverging Asset Flows” (Sept 2025).

3. Reuters, “August Jobs Report Misses Expectations, Fed Cut Eyed” (Sept 2025).

4. CBRE, “Data Center Trends and Investment Outlook” (Q2 2025).

5. Bloomberg, “U.S. Debt Downgrades and Fiscal Pressures” (Aug 2025).

Strong Earnings, But Concentration Risk Persists

Second-quarter earnings season delivered upside surprises across the board. Roughly 80% of S&P 500 companies reported positive EPS surprises and a similar proportion beat revenue expectations.¹ For Q2 2025, the blended year-over-year earnings growth rate for the S&P 500 is 11.9%. If this growth holds, it will mark the third consecutive quarter of double-digit earnings growth for the index.¹

While these results affirm economic resilience, the concentration risk among mega-cap technology companies—the “Magnificent 7”—remains a concern. Their profitability continues to drive index-level performance, but their sheer weight in market capitalization raises systemic vulnerability. If volatility spikes or one mega-cap faces disruption, the outsized impact on both market returns and investor sentiment could be severe.²

Tariffs, Courts, and the New Industrial Policy

On Friday, a federal appeals court restricted President Trump’s ability to impose new tariffs, though existing tariffs remain in place until at least October.³ The Trump administration argued that the ruling undermines its ability to negotiate trade, raise revenue to offset the recent tax cut bill, and reshore manufacturing.

Economically, however, labor in the U.S. remains significantly more expensive than abroad, limiting the return of traditional manufacturing. Where reshoring does occur, it is likely to be highly automated. We believe the real investment opportunity lies in sectors aligned with the AI-driven industrial boom:

• Data centers – Critical for artificial intelligence workloads, with soaring power demand and potential for asset appreciation.⁴
  

• Utilities & the U.S. power grid – After decades of flat demand, the surge in AI-related electricity consumption makes grid modernization an investable theme.⁵

Gold and the Fed: Signals of Shifting Confidence

Gold prices continue to rally as central banks diversify away from the U.S. dollar.⁶ Investors remain alert to U.S. policy volatility, which reinforces the appeal of gold as a hedge.

Meanwhile, markets are pricing in a Fed rate cut this month amid slowing job growth.⁷ While we agree a modest cut is likely, we do not see the start of an aggressive easing cycle. Earnings remain strong, consumer spending is resilient, and deregulatory momentum supports corporate activity. A cut may stimulate equities, but combined with tariffs, it could also prove inflationary, raising the risk of stagflation—slowing growth alongside rising prices.

Geopolitics: China Steps Into the Void

A recent summit in China with BRICS nations underscored Beijing’s ambitions to position itself as an alternative to U.S. leadership.⁸ Notably, India participated despite historically strained relations, reflecting shifting alliances. This comes after the Trump administration imposed tariffs on India for continuing to buy Russian oil—even though the Biden administration had previously offered tacit acceptance.⁹ Meanwhile, China itself faces retaliatory tariffs for its oil purchases, deepening global fragmentation.

Investor Perspective: Where to Allocate Amid Uncertainty

Given earnings strength but rising geopolitical and policy risks, we continue to see opportunity in real assets and innovation:

• Real estate housing supply – With a shortage of 3–6 million units depending on methodology, residential development remains a long-term theme.¹⁰
  

• Energy & infrastructure – The U.S. remains an energy powerhouse, supported by deregulation and capital flows into infrastructure.¹¹
  

• Gold and commodities – Central bank purchases of gold are likely to persist, while tariffs drive commodity prices higher.⁶
  

• Technology – AI and related innovation continue to shape productivity and long-term growth, though concentrated exposures warrant caution.

This Week’s Takeaway

Strong fundamentals are colliding with fragile policy and geopolitical backdrops. For investors, the challenge is to stay positioned for long-term growth while protecting against the volatility of concentrated markets and shifting global alliances.

Community Spotlight: Back to School, Back to Impact

As a new school year begins, we want to pause and honor the educators who shape our communities every single day. Teachers don’t just deliver lessons — they inspire curiosity, build confidence, and open doors to opportunities that last a lifetime. Their work is the foundation of stronger families, resilient communities, and a more vibrant economy.

To every educator heading back into the classroom: thank you for your dedication, patience, and vision. The ripple effects of your work go far beyond the school walls — and we’re grateful for all you do.

Footnotes

1. FactSet Earnings Insight, Q2 2025 (Aug 29, 2025).

2. Bloomberg, “Mag 7 Concentration Risk Remains Elevated” (Aug 2025).

3. Wall Street Journal, “Appeals Court Limits Trump Tariff Authority” (Aug 30, 2025).

4. CBRE, “Data Center Trends and Investment Outlook” (Q2 2025).

5. IEA, “Electricity Demand and AI Growth” (July 2025).

6. Financial Times, “Central Banks Buy Gold Amid Dollar Diversification” (Aug 2025).

7. Bloomberg, “Markets Price In September Fed Rate Cut” (Aug 28, 2025).

8. Reuters, “China Hosts BRICS Summit, India Joins Amid Tensions” (Aug 2025).

9. Politico, “Trump Slaps Tariffs on India Over Russian Oil” (Aug 2025).

10. National Association of Realtors, “Housing Supply Gap 2025” (June 2025).

11. U.S. EIA, “U.S. Energy Outlook 2025” (Aug 2025).

Lisa Cook, confirmed in 2022 and reappointed in 2023, is the first Black woman to serve on the Federal Reserve Board of Governors. She holds a PhD in Economics from UC Berkeley, built a distinguished academic career—including roles at Michigan State University and the Chicago Fed—and has advised numerous policymakers. Her appointment marked a significant stride for representation and institution-building.¹

On August 20, 2025, President Trump demanded Cook’s resignation following allegations—originating from a referral by the Federal Housing Finance Agency—that she claimed two separate properties as her primary residence when applying for mortgages. Cook has rejected both the substance of the allegations and the legitimacy of any dismissal, asserting that Trump lacks legal authority and promising to continue her service.² Cook’s defenders emphasize that no public evidence or criminal charges have been brought forward.³

Should Cook eventually be removed, and with the expected confirmation of Stephen Miran—Trump’s nominee to fill the vacancy created by Adriana Kugler’s departure—the Board of Governors could consist of five of seven members aligned with Trump’s policy preferences. This would represent further consolidation of control over a historically nonpartisan institution.⁴

Market Shifts: Immediate Ripples and Enduring Risks

As of market close on Monday, the S&P 500 was up 9.48% year-to-date, while the tech-heavy Nasdaq Composite gained 11.07%. The Russell 2000 index rose 4.89%, and the VIX—Wall Street’s “fear gauge”—was down more than 13%, all suggesting markets were positioned positively prior to Trump’s announcement regarding Cook.⁵

Following the news, markets showed mixed reactions. Stock index futures dipped modestly, reflecting concerns over the erosion of central bank independence, while long-term Treasury yields rose, signaling heightened anxiety around potential inflation and instability. The U.S. dollar weakened initially, and gold surged, only to retrace once Cook reaffirmed her refusal to resign.⁶

Equity markets may still interpret the shift as a de facto stimulus—anticipating looser monetary policy as Fed autonomy weakens—potentially driving short-term gains. By contrast, bond markets are less sanguine: rising yields reflect investor unease over inflation risk and the broader implications of a politicized Fed.⁶

Credit Impact: Another Downgrade Looming

The U.S. sovereign credit profile has steadily eroded since the Great Financial Crisis. Standard & Poor’s downgraded the rating from AAA to AA+ in 2011, and Fitch followed suit in August 2023.⁷ Most recently, on May 16, 2025, Moody’s downgraded the U.S. from Aaa to Aa1, citing unsustainable debt trajectories, persistent fiscal deficits, and rising interest servicing burdens.⁸

This downgrade brought Moody’s into alignment with the other two major rating agencies, signaling collective concern about fiscal discipline and governance. Without meaningful reforms, deficits—potentially ballooning to 7–9% of GDP—and a debt burden projected at 134% of GDP by 2035 may strain confidence further.⁸

From an institutional perspective, we remain cautious about the notion of government as an active investor. Historically, public institutions have not been the most efficient capital allocators, and we do not believe government should be in the business of “making deals” to generate revenue. Revenue should be driven by policy, not by strategic equity stakes or transactional interventions. When governments attempt to “pick winners and losers”, the risk is that taxpayer dollars are managed with the same inefficiencies that often characterize bureaucratic agencies-undermining both accountability and long-term fiscal discipline.

Given this fragile backdrop, Trump’s push to exert influence over the Fed—a cornerstone of economic credibility—risks triggering market angst or another downgrade if perceived as undermining institutional integrity.

Institutional Assessment: Echoes of Centralization

At Invested In Us, our institutional posture remains steadfastly balanced: rigorous, principled, and cautious. Last week, we warned of mounting centralization across governance frameworks. Today’s developments confirm that warning: eroding Fed independence, merging policymaking with political expediency, and replacing diverse voices with ideological alignment threaten the very architecture of economic stability.

While the data infrastructure—the BLS, Treasury, Fed—remains among the most transparent globally, this incident underscores the fragility of that structure when political considerations overshadow process.

Parallels to the 1920s — and Lessons for Today

The 1920s and 2020s share striking similarities: surging markets, technological breakthroughs, favorable tax and policy shifts, and a political environment tilting toward more centralized authority. A century ago, those conditions fueled a boom that ended abruptly with a depression and then war. Today, rising debt burdens, deficits, and geopolitical tensions suggest the same structural fragility beneath today’s prosperity.

Investor Perspective

For investors, the pressure on the Fed underscores a recurring theme: governance risk is market risk. While equity markets may view political influence over monetary policy as short-term stimulus, bond markets and credit agencies signal a more sobering outlook — higher yields, heightened inflation expectations, and a steady erosion of U.S. institutional credibility. The strength of the U.S. economy has always been anchored by independent institutions. When that independence falters, volatility follows.

This Week’s Takeaway

Political gains may drive short-term rallies, but sustainable value depends on independent, credible institutions.

Community Spotlight: Your Village Journey

This week we’re spotlighting Your Village Journey, a psychology and wellness hub based in Fairfield, CT. Founded by two clinical psychologists, Dr. Jennifer Doran and Dr. Jennifer Lawson, YVJ offers therapy, coaching, and consulting services — both locally and via telehealth — with one mission: to expand access to mental health and wellness for everyone.

At NJK, we see mental health as a core pillar of the Family Economy Ecosystem, just as vital as housing, education, and community spaces. By providing evidence-based, compassionate care, YVJ strengthens families, equips individuals with tools to thrive, and ultimately builds more resilient, connected communities.

📲 Follow Your Village Journey on Instagram

Explore their blog and additional resources at yourvillagejourney.com 🌱

Footnotes

1. Washington Post, “Trump moves to fire Federal Reserve governor Lisa Cook” (Aug 25, 2025).

2. Politico, “Trump calls on Fed board member Cook to resign” (Aug 20, 2025).

3. Reuters, “US DOJ to probe Fed’s Cook, urging removal” (Aug 21, 2025).

4. Investopedia, “Trump Says Fed’s Lisa Cook Is Out, Stephen Miran Nominated” (Aug 25, 2025).

5. Market performance data as of August 25, 2025 close (Bloomberg).

6. Financial Times, “Pray for the US Treasury market” (Aug 2025).

7. S&P downgrade history (Aug 2011).

8. Moody’s downgrade from Aaa to Aa1, May 16, 2025 (Moody’s press release).

Markets Are Rallying, Earnings Beat Lowered Expectations

As of August 15, the S&P 500 is up 10.6% year-to-date, with telecom and information technology leading performance, while healthcare remains the weakest sector [1]. Since April 8, the index has gained nearly 30%, a rally powered more by optimism around deregulation and tax cuts than fear of tariffs [1].

Earnings season has been stronger than anticipated, but context matters. During April’s volatility, many companies lowered or even withdrew forward guidance [1]. By resetting the bar lower, management teams may now be reaping the benefits of optics — “beating” numbers that were already reduced.

AI Spending, Slowing Jobs, and the Fed’s September Dilemma

Several companies have announced multi-billion-dollar investments in artificial intelligence, betting that these technologies will unlock productivity gains and long-term job creation [1]. In the near term, however, job growth has slowed, which is why investors are increasingly pricing in the likelihood of a Federal Reserve rate cut in September [1]. While markets are convinced of easing, the economic data has not yet confirmed a sharp slowdown. Any move would likely be an alignment cut — bringing policy rates closer to inflation, now running below 3% against a 2% target [1]. The risk: a cut that stimulates activity could also reignite inflationary pressures.

Debt and Deficits: A Sobering Backdrop

The U.S. national debt has surpassed $37 trillion [2]. In July alone, the federal deficit reached $291 billion, nearly 20% higher than the same month last year [3]. Through the first ten months of fiscal 2025, the deficit totals $1.6 trillion, about $109 billion wider than the same period in 2024 [4]. Debt now exceeds 100% of GDP — a level last seen during World War II [5]. Interest payments alone consume nearly $880 billion annually, more than the government spends on Medicare or defense [6].

Parallels to the 1920s — and Lessons for Today

The 1920s and 2020s share striking similarities: surging markets, technological breakthroughs, favorable tax and policy shifts, and a political environment tilting toward more centralized authority. A century ago, those conditions fueled a boom that ended abruptly with a depression and then war. Today, rising debt burdens, deficits, and geopolitical tensions suggest the same structural fragility beneath today’s prosperity.

Investor Perspective

The lessons of history are clear. Extended booms built on leverage and policy stimulus can leave economies exposed to sudden shocks. Just as in the 1920s, prosperity and fragility coexist. For investors, the most effective defense is diversification and a focus on high-quality assets that can endure volatility.

This Week’s Takeaway

Periods of euphoria rarely end smoothly. Discipline and preparation matter most when history begins to rhyme.

Community Spotlight

At NJK, we believe community is the foundation of growth. This week, we’re highlighting Eric Kleinstein, Founder of The BORK Club (Business Owners Raising Kids) — a platform created to support, connect, and celebrate entrepreneurs who are building both businesses and families.

Through conversations, resources, and a growing community, The BORK Club is redefining what it means to balance entrepreneurship and parenthood.

👉🏽 Follow on Instagram

📰 Subscribe to The BORK Club newsletter for weekly insights:

The BORK Club

🗞️ The BORK Report | Friday Scaries #2

We’re back with another issue of Friday Scaries, and today we’re talking about the elusive dream of being everywhere at once and actually getting something done…

Read more

8 months ago · 1 like · 1 comment · The BORK Club

Sources
[1] Reuters – US deficit grows to $291 billion in July despite tariff revenue surge (Aug 12, 2025).
[2] Fox Business – US debt tops $37 trillion (Aug 2025).
[3] Associated Press – US July budget deficit up 20% year-over-year despite record tariff income (Aug 2025).
[4] Bipartisan Policy Center – Deficit Tracker (2025).
[5] Pew Research – Key Facts About the U.S. National Debt (Aug 2025).
[6] Pew Research – Government Interest Payments Outpacing Medicare and Defense (Aug 2025).

Today’s tariff policy could follow a similar trajectory. The immediate economic data show minimal disruption, but higher input costs are quietly accumulating. If the U.S. and major trading partners escalate measures, the lagged effect could hit corporate margins, tighten supply availability, and slow capital spending — just as we saw post-COVID.

Why Tariffs Are Really Being Used

Beyond the headlines, we believe the current tariff strategy serves three primary purposes:

1. Raise revenue – U.S. customs duties have already topped $152 billion this fiscal year³, helping offset record deficits.
   

2. Reshore manufacturing – Tariffs create an incentive to relocate production to the U.S., though many low-skill roles are likely to be automated.
   

3. Geopolitical leverage – Tariffs act as a pressure point in broader trade negotiations and energy diplomacy, particularly with nations still buying sanctioned commodities.

The policy aims are clear — but execution is constrained by structural labor shortages and political bottlenecks.

Markets Are Strong, But Leadership is Thin

The S&P 500 has gained 9.5% year-to-date, while the Nasdaq is up more than 10%⁴, driven largely by mega-cap technology and telecom. By contrast, healthcare and consumer discretionary stocks are flat to negative. The VIX, Wall Street’s fear gauge, remains below $20 — signaling investor optimism — but concentrated leadership and policy uncertainty suggest the rally rests on a narrower base than headline numbers imply.

Gold’s Climb Signals a Broader Shift in Reserves

Gold is within striking distance of all-time highs. This is not a retail speculation story — it’s a central bank strategy. Over the past decade, monetary authorities have purchased more than 5,500 tonnes of gold, with China and Russia leading the trend⁵. The goal: diversify reserves away from the U.S. dollar, hedge against sanctions risk, and build greater monetary autonomy. That structural demand supports gold even in risk-on markets.

Reshoring Meets Reality: Labor is the Bottleneck

According to the U.S. Bureau of Labor Statistics (BLS), there were 415,000 open U.S. manufacturing jobs in June 2025⁶. Many require advanced skills, and are hard to fill due to wage pressures, geographic mismatches, and slow permitting processes. Even with tariff-driven incentives, these constraints mean reshoring gains will take years to materialize.

401(k) Access to Private Equity and Real Estate: Opportunity with Caveats

Recent regulatory changes allow certain 401(k) plans to include private equity and real estate allocations. For sophisticated participants, these asset classes can offer diversification and potential outperformance over time. However, higher fees, illiquidity, and valuation opacity require a more institutional approach to manager selection and risk monitoring. Inexperienced plans or participants could face unfavorable outcomes if these investments are treated like public-market allocations.

Debt, Deficits, and the Cost of Carry

The U.S. will spend nearly $1 trillion on interest payments this year — almost four times the level of a decade ago and roughly 25% of federal revenue⁷. Unlike Japan, where debt accumulation has funded domestic investment, much of America’s deficit expansion has gone toward tax cuts for top earners and emergency responses to crises such as the Great Financial Recession of 2008 and the Covid-19 pandemic of 2020. With debt service costs rising, the government’s fiscal flexibility is narrowing — and future stimulus will face tighter constraints.

Corporate Capital Allocation: Record Buybacks, Limited Capex

U.S. companies have announced $984 billion in share repurchases this year, on track to exceed $1.1 trillion⁸. While buybacks support EPS in the short term, they also reflect a lack of compelling reinvestment opportunities. Overreliance on this approach may erode long-term earnings growth potential, especially if revenue growth slows in a weaker macro environment. Historically, large corporate tax cuts have often been followed by a surge in share repurchases and higher savings rates among top earners, rather than proportionate increases in productive investment. After the 2017 corporate tax rate reduction, U.S. companies spent a record $806 billion on buybacks in 2018⁽⁹⁾ — far exceeding the growth in capital expenditures. This dynamic can limit the flow of resources into sectors such as infrastructure, healthcare, and education that drive broader economic productivity.

Investor Perspective

The parallels between tariffs today and COVID’s delayed supply chain shock are too close to ignore. Add in concentrated market leadership, structural labor shortages, record buybacks, and rising debt service — and the case for proactive portfolio resilience strengthens. Diversification and disciplined allocation remain the best defenses against lagged shocks.

This Week’s Takeaway:
Markets reward preparation. Don’t wait for the lagging effects to appear before acting.

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Community Spotlight

At NJK, we believe investing isn’t just about numbers — it’s about neighbors. That’s why each week, we’re highlighting a local entrepreneur, family, or initiative that reflects the values of discipline, purpose, and resilience.

Ingrid Zapata Read | Grow With Community & Community Made

This week, we’re spotlighting Ingrid Zapata Read — strategist, connector, and founder of Grow With Community and Community Made. Through her workshops, collaborations, and thought leadership, Ingrid equips entrepreneurs with the tools, confidence, and connections to grow with intention.

Her recent Sunday Send-Off newsletter explored the power of digital omnipresence — showing that true visibility isn’t just about being online, but showing up in ways that resonate and build trust.

Community Made

Sunday Send-Off #4: The digital omnipresence myth

“I’ve been seeing you everywhere lately…

Read more

8 months ago · 4 likes · Community Made

Explore her work: Let's Grow With Community
Follow her along: @growwithcommunity
Subscribe to her newsletter: Community Made

Sources:

1. Drewry World Container Index, 2021 shipping cost data.

2. Asian Development Bank, global GDP impact estimates, 2022.

3. U.S. Treasury customs duties data, FY2025.

4. FactSet market data, Aug 8 2025.

5. World Gold Council, Q2 2025 central bank gold purchases.

6. U.S. Bureau of Labor Statistics, JOLTS June 2025.

7. U.S. Congressional Budget Office, July 2025 budget update.

8. Birinyi Associates via Wall Street Journal, Aug 2025.

9. Birinyi Associates via Wall Street Journal, “Buybacks Surge After Tax Cuts,” March 2019.

Earlier this year, following major geopolitical developments and tariff announcements, the market briefly dipped into bear market territory, falling nearly 20%. While the speedy recovery has been encouraging, the environment remains far from stable.

Key sector trends:

• Industrials and Utilities have led recent gains

• Consumer Discretionary is down nearly 5%

• The S&P 500 Equal Weight Index — a broader measure of market health — is up nearly 4%, suggesting strength beyond just mega-cap tech

Why it matters: A strong, diversified rally reflects a healthier market than one driven by a few companies. But volatility, especially tied to tariffs and geopolitics, continues to be a key risk.

The Fed, Rate Cuts & Real Impact on You

There’s been growing debate about interest rates — and the tension between the White House and the Federal Reserve is escalating.

• President Trump has publicly criticized Fed Chair Jerome Powell (his own appointee), claiming the Fed was “late” in cutting rates.

• Some economists argue rate cuts may be justified due to high borrowing costs (especially for homes and cars), while others point to low unemployment and strong GDP (a country’s total economic output) as evidence that cuts are premature.

Here’s what to know:

• The Fed controls short-term rates, but mortgage rates are more directly influenced by the 10-year Treasury yield.

• America’s $37 trillion debt and growing deficits are keeping long-term yields elevated, putting upward pressure on mortgage and credit card rates — regardless of what the Fed does.

Bottom line: A Fed rate cut may not provide the relief consumers and investors are hoping for — especially with structural debt challenges looming.

A Jobs Report — and a Firing

Last Friday, the Bureau of Labor Statistics reported:

• Estimated 73,000 jobs created in July

• When accounting for downward revisions, it marked the weakest three-month stretch since the height of COVID

In response, Trump fired BLS Commissioner Erika McEntarfer, despite her bipartisan confirmation (86–8 in the Senate). The President publicly accused the BLS of manipulating data — a claim widely rejected by economists, including William Beach, his own prior BLS appointee.

Why this matters: The BLS is the gold standard for independent labor data. Undermining its credibility threatens investor trust, policymaking, and America’s financial reputation globally. During the chaos driven by “Liberation Day,” the bond market experienced serious volatility as investors briefly questioned America’s financial credibility. Public disputes like the firing of the BLS Commissioner could add to concerns, further undermining confidence in the integrity of U.S. institutions.

Global Trade: Tariffs, BRICS & Geopolitics

Tensions continue to rise on the international stage — both militarily and economically.

• Russia has replenished much of the equipment lost in Ukraine, signaling a long-term commitment to the conflict.

• NATO leadership warns the U.S. must be prepared for a two-front conflict: a Russian escalation in Europe and potential Chinese aggression in Taiwan.

• In response, Trump has moved nuclear-capable equipment into Europe and signaled he is open to using tariffs as leverage against Russia — and any country still purchasing Russian oil.

While Russia is not the world’s largest exporter, its role in global energy markets is significant due to its close relationships with China and India — both major oil consumers and founding members of the BRICS alliance (Brazil, Russia, India, China, South Africa).

Tariff Timeline:

• Trump’s “Liberation Day” introduced sweeping tariffs, aimed at reshaping global trade.

• Several agreements have been announced, but many negotiations remain ongoing.

• Despite uncertainty, the U.S. Treasury has reportedly collected $152 billion in customs duties this fiscal year — nearly double the amount at this point last year.

Why this matters:
Tariffs are unpredictable, and their costs are often absorbed by a combination of importers, exporters, and consumers. As trade tensions escalate, energy markets and global supply chains face new volatility — all of which affect inflation, earnings, and investor sentiment.

Investor Perspective

As we move into the fall — a historically volatile season for markets — here’s what to keep in mind:

• Markets are resilient but reactive — policy uncertainty and geopolitical risk remain top of mind.

• Diversification is essential — even more than usual in an environment where headlines can drive short-term moves.

• Data integrity matters — investors rely on accurate information to make decisions. Political interference in institutions like the Fed or BLS creates risk.

At NJK, we continue to believe that long-term clarity beats short-term chaos. In moments like these, the most valuable asset is not a hot stock — it’s a calm, focused mindset.

This Week’s Takeaway

“Just because the market is near its highs doesn’t mean the economy is. Stay sharp. Stay diversified. And stay focused on what you can control.”

Community Spotlight

At NJK, we believe investing isn’t just about numbers — it’s about neighbors. That’s why each week, we’re highlighting a local entrepreneur, family, or initiative that reflects the values of discipline, purpose, and resilience.

Alexandra Szebenyik | The Sandra Effect

This week, we’re spotlighting Alexandra Szebenyik, a talented Fairfield-based photographer whose eye for detail and professionalism helped capture the images now featured across NJK’s platforms. We’re grateful for her work and look forward to future collaborations.

Explore her work and book a session: alexandraszebenyik.com

With Respect & Purpose,
Kevin Nunez
Founder & CEO, NJK Partners
📧 kevin@njkpartners.com | 🌐 njkpartners.com | 🎥 YouTube Shorts

Resource Notes

1. NATO Commander Grinkevich: Reuters, July 2025

2. Russian Equipment Rebuild: Bloomberg, July 2025

3. Trump Nuclear Equipment Deployment: Politico, July 2025

4. Tariff Collections: U.S. Treasury via New York Times, July 31, 2025

5. BLS Firing & Job Report: CNN, August 2, 2025

6. Interest Rates & Mortgage Impact: WSJ, July–August 2025

7. S&P 500 Performance: FactSet, August 1, 2025

8. BRICS Oil Trade Trends: Financial Times, July 2025
   
   

In our experience, wealth is created in just two ways:

1. Building and scaling a business that generates enterprise value

2. Consistently saving and investing over time with a clear, long-term plan

The second option — long-term investing — has historically outperformed short-term speculation. In fact, research from the University of California shows that only about 1% of day traders consistently outperform the market (Barber et al., 20141). Most actually underperform after fees, taxes, and timing mistakes.

Which brings us to the foundation of this newsletter: it all starts with goals.

Strategic Planning > Stock Picking

Before you decide what to invest in — or even whether to invest — the real question is:

What are you investing for?

At NJK, we break that question down into a strategic framework:

Three Types of Goals

• Personal – health, family, lifestyle

• Professional – career, business, leadership

• Financial – freedom, security, legacy

Three Time Horizons

• 1–3 years

• 5–10 years

• 10–20 years+

We encourage our community to reverse-engineer their investment strategy based on this grid. Without this structure, most financial decisions are reactive. With it, you begin to allocate capital not to noise — but to purpose.

What to Expect from Invested in Us

This weekly publication is NJK’s platform to deliver high-quality insights with institutional discipline and community intent. Each issue will cover:

• Financial market context and policy updates

• Investment education and behavioral finance

• Entrepreneurship and real-asset ownership

• Spotlights on underserved communities and families building wealth

• Tools to improve financial literacy across generations

We built NJK for families and communities historically excluded from traditional private equity, wealth advisory, and institutional finance. Our goal is not just to inform — it’s to build better investors, business owners, and leaders.

We appreciate your trust as we grow this platform from the ground up.

Let’s get to work.

With gratitude & love,
Kevin Nunez
CEO, NJK Partners