Market Outlook, October 2025

 From our broker's report. "U.S. stocks extended their rally into the third quarter, led by strong recoveries in technology, consumer discretionary, and communication services-sectors previously pressured by tariff concerns. The S&P 500 has surged over 30% since the April 8th low, highlighting the resilience of markets and investor confidence amid ongoing uncertainties like tariffs, Federal Reserve scrutiny, cooling consumer spending, softening job growth, and the recent government shutdown.  Despite volatility, our strategy remains anchored in broad diversification, deliberately avoiding overconcentration in any one sector or stock, while hedging against inflation and stagflation risks."

Then says Yahoo. S&P 500 INDEX (^SPX) Historical Data - Yahoo Finance

Then says U.S. Bank:  "President Donald Trump has prioritized domestic manufacturing while extending key tax cuts from the 2017 Tax Cuts and Jobs Act, leading investors to question the stock market’s direction. After the inauguration, President Trump announced and implemented numerous tariffs, causing the S&P 500 to drop nearly 20% in just seven weeks. However, the market rebounded strongly; after reaching its lowest point of 2025 on April 7, the S&P 500 has surged more than 34% and remains near all time high."  Stock Market Under the Trump Administration | U.S. Bank.

Republicans want the perfect bill--there's no such thing

Big beautiful bill. Republicans demand the perfect; Democrats demand that anything Trump must be hated.

 
Donald J. Trump has had the most successful presidency that I can remember (closed the border using current law, lowered the crime rate, raised incomes, negotiated the tariffs sending stock market soaring, worked with Israel for the successful bombing of Iran's nuclear development stores thus fulfilling the work of 15 years [under 2 other Democrat presidents, btw], got NATO to increase their share, brought warring African countries to the table, put roadblocks against racist policies in universities, defied stupid DEI and climate policies), yet there are Republicans who are pouting because their favorite piece isn't in the puzzle. So they can screw up the biggest tax cut for the middle class, in an attempt to help their state, but hurt the rest of us. Or just because they too hate Trump's success. So much for patriotism. Like VDH observes, they won't harvest at 70% success and wait until the hail destroys the entire crop.

Republicans Who Voted Against Big Beautiful Bill Revealed

Are you ready to retire?

 I retired 25 years ago (Oct. 2025), and I've lived through a number of down turns in the stock market, which now is my income. Dot com bubble hit just as I was planning what I'd do with all that time. Remember that one? It was during the Clinton years, although he wasn't responsible for the bubble or the burst. I was just learning how to read the WSJ and follow the stocks! Checking daily could make one faint. For those of you about to retire, here's a reminder.

"The dot-com bubble (or dot-com boom) was a stock market bubble that ballooned during the late-1990s and peaked on Friday, March 10, 2000. This period of market growth coincided with the widespread adoption of the World Wide Web and the Internet, resulting in a dispensation of available venture capital and the rapid growth of valuations in new dot-com startups. Between 1995 and its peak in March 2000, investments in the NASDAQ composite stock market index rose by 800%, only to fall 78% from its peak by October 2002, giving up all its gains during the bubble."

Repeat. Giving up all its gains during the bubble.

If you sold anything since April 2 and the tariff announcements because you were listening to the legacy media, aka the "sky is falling and it's Trump's fault" media, then you're just not ready to retire yet.

What's with DeepSeek?

The “Hard Fork” podcast released a bonus episode titled “Your Guide to the DeepSeek Freakout: an Emergency Pod” on Tuesday, January 28, 2025. In this episode, Kevin Roose and Casey Newton discuss the impact of a new AI model from a Chinese firm called DeepSeek. This model has caused significant disruption, including affecting global markets and pushing Nvidia’s stock down while simultaneously rising to the top of the iPhone app store. The hosts explore the implications of this development for the U.S. artificial intelligence industry and consider what it means for the broader AI landscape. (AI generated) 

You'll need to set up an account to hear the podcast,

Have the hearings affected the market?

Ross Rant, 11/25: "Clearly the Schiff Show had no impact on the market as everyone knows it was all just a reality show for the Dems that has fallen flat with most voters. Most people no longer care. It is now holiday season and parties, no one has time for a bunch of Dem politicians making rash statements for TV. Nobody outside DC and CA cares anymore. Republicans are all geared up to destroy Biden if this goes ahead, and maybe the Dems are figuring that out as the polls now show a majority of voters are not in favor of impeachment. Horowitz will be out in two weeks and that will suck the oxygen out of the room, and may give Republicans some attack points to go after the Dems. Then comes Durham early next year with indictments. And now Biden says he might select Stacy Abrams, the failed GA gubernatorial candidate, as VP. Do I hear the Democratic Palin. Can you imagine trying to sell Abrams as one heart beat from being president with a 78 year old starting his term. Yikes."

Ross assumes his readers know all the players, like Horowitz, Durham and Abrams.  Here’s the score:

https://www.zerohedge.com/political/horowitz-report-coming-horowitz-report-coming-lindsay-graham-signals-early-dec-release

https://www.sgtreport.com/2019/10/deep-state-in-total-panic-as-durhams-investigation-confirmed-to-have-transitioned-to-criminal-phase-indictments-imminent/

https://www.washingtonexaminer.com/opinion/joe-biden-embraces-the-stacey-abrams-voter-fraud-myth

The Great Recession--was it?

The academic definition of a recession set by the Business Cycle Dating Committee of the National Bureau of Economic Research described the last recession as the 18-month period from December 2007 to June 2009. Using the broader definition of the word “recession” as a period of reduced economic activity, it is customary these days to claim the recession as two years,  the period from December 2007 to January 2010--"The Great Recession."  That would give the Bush administration 12 months and Obama administration 12 months.  Obama, however, had Democrat control of both houses his first two years, and Bush was saddled with a hostile Congress his final two years, led by Reid and Pelosi. The Democratic Party controlled a majority in both chambers of the 110th for the first time since the end of the 103rd Congress in 1995  (2 independents voted with Democrats). The Recession was global, but in the U.S. it belongs to the Democrats, with the roots of the housing crisis going back to1977 and the Community Reinvestment Act.

The current struggle to stop tax reform and keep economy busting regulations in place is led by Democrats even today, with a number of anti-Trumper Republicans assisting them out of personal animosity for the president.  The sluggish economy finally lifted in the final year of Obama’s reign with a Republican Congress. Determined and heroic Americans both liberals and conservatives in small businesses and the energy fields began to regain their footing, and the stock marked recovered.

Since November 2016, there has been more hope and change in the economy, something Obama just couldn’t deliver, despite his promises. Trump's detractors say he inherited a robust economy--which is only partially true--the Democrats had forgotten the middle income worker (aka "deplorables" according to Clinton).
http://www.businessinsider.com/the-cra-debate-a-users-guide-2009-6
https://www.marketwatch.com/story/good-news-for-the-president-in-latest-trump-scoreboard-2017-11-03

http://www.peoplesworld.org/article/no-troop-surge-as-110th-congress-gets-to-work-the-call-is-raise-minimum-wage-end-iraq-war/
https://www.cfr.org/backgrounder/impact-110th-congress-us-foreign-policy

Why the wealthy have done well under Obama

It’s a puzzle considering how Obama demonizes the “fat cats” that the upper 20% have done so well the last 4-5 years (aka the recovery) and the rest of the economy flounders. Record numbers are on food stamps, and many college new graduates are discouraged. Unemployment among young black men is much higher than before the recession.  This semi-annual report from Blackrock gives a pretty good explanation of how quantitative easing has helped the investors in stocks.  Now, this is a policy of the Federal Reserve, not the President’s, but at least he didn’t nix it.  If you are invested in a pension, 401-k or 401-b or IRAs, you’ve seen a similar, but smaller advance. People with CDs or savings accounts (usually less wealthy) have seen their savings eroded.

“One year ago, US financial markets were improving despite a sluggish global economy, as easy monetary policy gave investors enough conviction to take on more risk in their portfolios. Slow but positive growth in the US was sufficient to support corporate earnings, while uncomfortably high unemployment reinforced expectations that the Federal Reserve would continue its aggressive monetary stimulus programs. International markets were more volatile given uneven growth rates and
more direct exposure to macro risks such as the banking crisis in Cyprus and a generally poor outlook for European economies. Emerging markets significantly lagged the rest of the world amid fears over slowing growth and debt problems.

Global financial markets were rattled in May when then-Fed Chairman Bernanke mentioned the possibility of reducing (or “tapering”) the central bank’s asset purchase programs — comments that were widely misinterpreted as signaling an end to the Fed’s zero-interest-rate policy. US Treasury yields rose sharply, triggering a steep sell-off across fixed income markets. (Bond prices move in the opposite direction of yields.) Equity prices also suffered as investors feared the implications of a
potential end of a program that had greatly supported the markets. Markets rebounded in late June, however, when the Fed’s tone turned more dovish, and improving economic indicators and better corporate earnings helped extend gains through most of the summer.

Although autumn brought mixed events, it was a surprisingly positive period for most asset classes. Early on, the Fed defied market expectations with its decision to delay tapering, but higher volatility returned in late September when the US Treasury Department warned that the national debt would soon breach its statutory maximum. The ensuing political brinksmanship led to a partial government shutdown, roiling global financial markets through the first half of October. Equities and other
so-called “risk assets” managed to resume their rally when politicians engineered a compromise to reopen the government and extend the debt ceiling, at least temporarily.

The remainder of 2013 was generally positive for stock markets in the developed world, although investors continued to grapple with uncertainty about when and how much the Fed would scale back on stimulus. When the long-awaited taper announcement ultimately came in mid-December, the Fed reduced the amount of its monthly asset purchases but at the same time reaffirmed its commitment to maintaining low short-term interest rates. Markets reacted positively, as the taper signaled the Fed’s perception of real improvement in the economy, and investors were finally relieved from the anxiety that had gripped them for quite some time.

The start of the new year brought another turn in sentiment, as heightened volatility in emerging markets and mixed US economic data caused global equities to weaken in January while bond markets found renewed strength. Although these headwinds persisted, equities were back on the rise in February thanks to positive developments in Washington, DC. For one, Congress extended the nation’s debt ceiling through mid-March 2015, thereby reducing some degree of fiscal uncertainty for
the next year. Additionally, investors were encouraged by market-friendly comments in new Fed Chair  Janet Yellen’s Congressional testimony, giving further assurance that short-term rates would remain low for a prolonged period.

While accommodative monetary policy was the main driver behind positive market performance over the period, it was also a key cause of investor uncertainty. Developed market stocks were the strongest performers for the six- and 12-month periods ended February 28. In contrast, emerging markets were weighed down by uneven growth, high levels of debt and severe currency weakness, in addition to the broader concern about reduced global liquidity. The anticipation of Fed tapering during 2013 pressured US Treasury bonds and other high-quality fixed income sectors, including tax-exempt municipals and investment grade corporate bonds. High yield bonds, to the contrary, benefited from income-oriented investors’ search for yield in the low-rate environment. Short-term interest rates remained near zero, keeping yields on money market securities close to historic lows.”

Could the federal government ever do what Starbucks did?

In January 2009 the stock of Starbucks was about $7, and today it’s in the mid-fifties, down a little from a few months ago.  So how did they turn it around without a government stimulus package?

“The company cut costs when a serious recession hit the economy in 2008. Raises were slashed to a minimal amount, vacation and personal time was cut and the health plan was altered to require more out-of-pocket expenses on the part of employees. The company pushed product sales hard, requiring managers to more aggressively market retail items such as coffee mugs, coffee makers and ground coffee to their walk-in customers.

Recently, the company has made some changes to improve its compensation for management employees. Starbucks has maintained health-care coverage as well as a stock-option program, known as Bean Stock. The company has also increased its contributions to its 401(k) program a retirement savings plan that is available to hourly and salaried employees.”

Read more: The Average Salary of a Starbucks Store Manager | eHow.com http://www.ehow.com/about_7486618_average-salary-starbucks-store-manager.html#ixzz2MIILv2l9

Sadly, no one in this administration and very few in Congress have business experience, and when they get to Washington it’s like having play money to spend.

Congressional staff gain from trading in stocks overseen by employers

The Wall Street Journal on October 11 looked at congressional financial disclosures and found 72 staffers of both Republicans and Democrats who held shares in companies overseen by the staffers' employers.

"Unlike many Executive Branch employees, lawmakers and aides don't have restrictions on their stock holdings and ownership interests in companies they oversee. Congressional rules say that requiring employees to do so could "insulate a legislator from the personal and economic interests that his or her constituency, or society in general, has in governmental decisions and policy." An analysis of financial-disclosure forms for 2008 and 2009 compiled by the website LegiStorm shows that several hundred congressional aides bought or sold stocks. At least 72 traded the stocks of companies their bosses write laws for."

Congressional Staffers Gain From Trading in Stocks - WSJ.com
While the rest of us piddle around in 4-5% gains, they're doing 90%+, but hey--no conflict; husbands and wives don't even discuss what's going on--the money just keeps on rolling in. And if you believe that. . .

Not if Obama keeps this up

Maybe we'll just move in with the kids. Got this in my e-mail today.

DO YOU HAVE ENOUGH TO LIVE THE RETIREMENT LIFE YOU WANT? Merrill Lynch invites Ohio State faculty and staff to attend a free retirement seminar; “Planning for Your Retirement Lifestyle,” on Wednesday (2/17) or Thursday (2/18) at the Fawcett Center.

Love or hate Glenn Beck, recently he's been lecturing on the debt our states are in due to some of their pension plans. As California goes, so goes the nation.

After being smacked around by the SOTU speech, the stock market went up a little when the government was so snowed in by this last global warming blizzard they couldn't do anything. In November 2008 everything started to nose dive because business sector knew more taxes and regulations were coming even before he took office. It accelerated the drop that began when Democrats took over Congress at the beginning of 2007.

Ben said it, not Obama

But markets respond to positive, upbeat messages, not gloom and doom, it'll-be-years talk.

"Bank stocks on Tuesday posted their best performance in almost a month, and their seventh biggest percentage gain ever, after Federal Reserve Chairman Ben Bernanke reiterated that the government would keep banks solvent and said he saw no need to nationalize some firms.

Investors rushed to buy bank shares after Bernanke said there is no benefit from nationalizing the biggest U.S. banks."

And Newsweek certainly didn't help the mood blasting us with this cover. Why would they decide to say what he is now? The authors sound like whiny kids--"Well, Bush did it first." Then why didn't they love Bush? They slobber over Obama!

"We got into this mess largely because of government meddling in the economy, and because of regulations, policies and agencies that have no business existing in a capitalist society in the first place." Newsbusters

And I don't trust Ben either. He and Hank laid the ground work.

How to create a Depression

. . .“while the Federal Reserve is predicting that unemployment from our current recession will remain high through at least 2011, President Obama plans to raise taxes on small businesses, corporations, and all Americans who invest in the stock market.” Morning Bell, Feb. 23.

That should make the markets respond--by going down even more. Thus the Obama Depression.

Investor's Business Daily reported in mid-October on the causes of a 6 week slide in the stock market:

• The imminent election of "the most anti-capitalist politician ever nominated by a major party."

• The possibility of "a filibuster-proof Congress led by politicians who are almost as liberal."

• A "media establishment dedicated to the implementation of a liberal agenda, and the smothering of dissent wherever it arises." And things haven't improved.Link

Going south for the decade with President Obama's Plan

Maybe if he weren't a tax cheat

we could trust him? Nah. He'd be doing Obama's bidding even if he were honest. Stocks fell again today. The markets have fallen continually since Obama became the candidate of the Dems in the summer. Why does Obama blame Bush for overspending when he's doing double triple time to out do him? Wasn't he a senator in a Democratic controlled Congress? Spending too much got us here; more spending takes us back to the 30s where FDR put us in a 10 year Depression. He's passing out lip-smackin' pork cracklins to his left wing buddies who put him in office.

U.S. Treasury Secretary Timothy Geithner may have wanted to put an end to the never-ending credit crisis by announcing a comprehensive approach to saving the banking system, but all he succeeded in doing Tuesday was adding uncertainty. Forbes here.


"The Obama administration is scrambling to get a grip on the economy as it continues its descent, including rising unemployment, falling housing prices and mounting foreclosures. The government's solution is a one-two punch: $800 billion in economic stimulus and the financial system stability plan.

Geithner wants to reverse the damage done by the previous administration's ad-hoc reaction to the banking crisis, which he faulted Tuesday for being "inadequate" and slow."

When Obama surges, the market falters

He didn't support the surge and victory in Iraq. Can you trust your 401-k to an Obama surge and victory?

"To state the obvious: The valuation of an individual stock reflects the collective expectation of investors about a company's future profits, dividends and appreciation, and the same is true of the market as a whole. These profits, in turn, are greatly influenced by government policy on taxes, spending, subsidies, environmental and other regulations, labor laws, and the corporate legal climate. Investors have heard enough from both candidates in the last month or two to conclude that prospects for a flourishing, competitive, growing and reasonably free economy in a McCain administration are bad, and in an Obama administration far worse. (In fact, the market's bearish behavior over the last couple of months pretty closely tracks Barack Obama's gains.)" George Newman

I've written about this too, but the Wall Street Journal has a larger readership than my blog.

Why I worry about the Boomers

God bless 'em, are they ready? Ready for retirement? That story this week in the WSJ was really outrageous. Jennifer Levitz opened with a story of a 59 year old who is "postponing" his retirement. Then she moves to a liberal economist who says what is happening today hasn't happened since the Great Depression. Oh really? That was before my time, but I did hear a few stories from my parents, and grandparents, and it's insulting to their memory and struggles to be whining like this. According to the article, their homes are worth less (than when, a year ago?) and their stocks are worth less (than last quarter?) so that makes it worse than the Great Depression. With all the information available in books and on the internet, do these people never look at charts?

She also wrote about Ellen Minter, 57, who had a 6 figure income before retiring--she probably made more in a year than I did in a decade. She and hubby sold their San Francisco home and bought real estate in California wine country; he retired and then their portfolio started to collapse. He's looking for work again. Why, unless you are a boomer for whom the waters have always parted, would you think the good times would always roll? If they were willing to cut back I'm guessing they could still make it, but high living is addictive--isn't it?

I retired at age 60, but I wouldn't have even considered it if a very unusual thing hadn't happened. My mother-in-law died. Now, she was in her 80s and had been in poor health at least 20 years, so that part wasn't a huge surprise. She had outlived her husband (who wasn't ill) who had retired (actually was pushed out) and moved his pension into a privately controlled account, so she got it all at a time when the stock market was on its way up. Shortly before she died, it was on its way down again, and we were going to start dipping into her principle to pay for her nursing home care. Her three children shared her estate equally, which included the primary residence and some property in Florida. Never in a million years would we have expected a dime from my husband's parents. We invested the money and I decided the income plus my pension just about matched my income if I continued to work. Now, obviously, we'd have a lot more if I'd continued working and banking that, but for what? What if I'd died or became ill at 64? Who wants to die at the reference desk answering questions about Cushings Disease in dogs or cryptorchid horses? Time is money, and I'm a millionaire if minutes count.

In 1999 and 2000, while I was still working, my 403b had three bad, bad quarters, and had really flattened after a very nice run up in the 90s. There was a technology bubble that burst. From 2001-2007, I had three bad quarters. Probably the biggest run up in history. But what did we hear from the media and the Democrats? We were told we were in the worst economy since the Great Depression. We may actually be on the cusp of a recession, and why shouldn't we? Smart people and dumb people both made bad choices on real estate investing.

But the boomers have a lot of years left to live in retirement. I hope they breathe deeply and put away a little for a rainy, down down day, because there will be more. They will further be hurt if they elect a Democrat who promises to raise taxes, tries to destroy businesses and jobs with global warming scares, and won't make us energy independent.

4083

Who wants to be a millionaire?

Rev. Jacob Frank Schulman and his wife Alice invested 25% of their income each year (married in 1954). He died in 2006 at 78 with an estate of over $20,000,000. Over the years they have been donors to various Unitarian causes, a branch of Christianity to which he converted in the 1950s. The story was in the WSJ today.

From his obituary: "Dr. Schulman was born March 26, 1927 in Nashville, Tennessee. He had an outstanding academic life with degrees from the following institutions: B.A. - University of Oklahoma; S.T.B. - Harvard University; D.Min. and D.D. - Meadville Lombard Theological School; M.A., D.Phil.,B.D. - University of Oxford.

Mr. Schulman was ordained in the Unitarian ministry in 1954 at the Arlington Street Church, Boston, Massachusetts. He served many congregations: Arlington Street Church, Boston; First Unitarian Church, Worcester, Mass.; First Unitarian Church, Youngstown, Ohio; Emerson Unitarian Church, Houston, Texas; Unitarian Church of Horsham, West Sussex, England; and Huntsville Unitarian Universalist Fellowship in
Texas. His last position before retirement was as Chaplain and Dean and Fellow in Theology at the Harris Manchester College, University of Oxford. Mr. Schulman was also named Minister Emeritus at Emerson Unitarian Church of Houston and at All Souls Church Unitarian Universalist, The Woodlands, Texas.

Frank Schulman was a prolific writer of books, pamphlets, and articles on topics from "Blasphemous and Wicked: The Unitarian Struggle for Equality, 1813-1844" (1997) to the pamphlet he edited, "Ralph Waldo Emerson Speaks." In addition, he was a sought-after lecturer, delivering the Berry Street Lecture (1981); the Minns Lecture (1982); and the Billings Lecture (1983). Mr. Schulman also served in the U.S. Navy during World War II and the Korean War."

However, if you're not interested in the pay of a minister and scholar, you might also consider sending your 18 year old to a state school instead of a private, or ivy-league college, and investing the difference each year in the stock market for the long haul. Your student will probably come out of this decision at age 50 or 60 thanking you and piling flowers on your grave. Plus s/he won't have that huge debt at graduation.