Weekly Commentary (9/22/2025) - The Illusion of Forever

What to Watch Right Now

1. Media Power Plays

• The Ellison family is pushing into media consolidation, circling both TikTok’s U.S. operations and Warner Bros. Discovery. These aren’t just business transactions — they’re bids for cultural relevance and control of the world’s most valuable commodity: attention.

2. AI’s Winners and Losers

• Fresh usage data shows AI is not a rising tide lifting all boats. Scale players are capturing most of the value, while smaller firms struggle to monetize.

3. Tariffs and Inflation Risk

• Renewed trade tensions and tariff discussions are stoking concern about inflation. Rising input costs, especially in energy and imports, could ripple through supply chains.

4. Energy and Geopolitics

• Military operations in the Middle East have heightened questions around oil supply and pricing. Energy markets remain a key swing factor for both inflation and global growth.

5. Mixed Inflation Data

• Consumer prices remain sticky, producer prices eased slightly, and consumer sentiment is weakening. Inflation is not yet solved — and that keeps the Fed in a delicate position.

Perspective

When I was an accounting student back in 2001, the firms everyone aspired to join were the “Big Five.” They seemed permanent, untouchable — the kind of institutions you could build a forty-year career in. I remember preparing for interviews with names like Arthur Andersen. At the time, it was one of the most respected firms in the world.

Within a few years, it was gone. Not merged. Not rebranded. Gone.

That experience left a mark. What looks permanent in business and markets rarely is. The pillars shift, the ground moves, and what seemed unshakable suddenly proves fragile.

Markets today carry a similar feeling. Prices are high. The rally seems durable. It’s tempting to believe the bull market can last indefinitely. But just like those firms, today’s market foundations deserve a closer look.

1. Growth is slowing, not collapsing.
The U.S. economy continues to expand, but the long-term pace has eased. Demographics, productivity, and trade suggest real growth closer to 1.5–2% rather than the 3–4% of prior decades.

2. Corporate profits have been unusually strong.
For decades, companies benefited from falling borrowing costs, lower taxes, and restrained wage growth. Today, all three are reversing. Margins remain healthy, but the tailwinds have shifted.

3. Valuations are stretched.
Forward P/E multiples sit well above long-term averages. Broader measures, like total market cap relative to profits, show the same. High valuations don’t guarantee a fall, but they do reduce the odds of repeating the last decade’s returns.

The scaffolding holding up this bull market is still in place, but it’s carrying more weight than ever.

Confidence

This doesn’t mean the story ends here. It means the next chapter will be different.

Markets rise on optimism, consolidate on fundamentals, and reset when expectations overshoot. The right response isn’t fear — it’s preparation.

We ask you to consider,

• Equities at the core. Innovation continues to reshape industries. Exposure remains essential.
• Diversification across the board. Concentrated bets are fragile when valuations compress.
• Fixed income restored. Bonds once again provide meaningful income and ballast.
• Alternatives for access.  Alternatives provide access to opportunities beyond traditional markets — offering diversification, enhanced income, and the potential for stronger long-term results.

The compounding power of disciplined investing still works. The lesson isn’t to run from change — it’s to adapt to it.

Action

Here’s what to consider now:

1. Rebalance, don’t retreat. Trim overweight equities back to your plan.
2. Lean into bonds. Higher yields mean fixed income can defend and pay again.
3. Look globally. International markets carry more reasonable valuations.
4. Review taxes. High valuations make this the right time to check gains, losses, and efficiency.
5. Stay focused on goals. Markets are a means to an end — funding your life with clarity and confidence.

Closing Thought

The collapse of Arthur Andersen was unthinkable at the time, yet it happened quickly. Markets are no different. What looks permanent often isn’t.

The next phase of investing will likely be slower, more selective, and more volatile. That’s not a cause for fear — it’s a reminder to strengthen portfolios, sharpen discipline, and focus on what endures.

We’ll keep watching the foundations — growth, profits, valuations — and the headlines — consolidation, AI, tariffs, energy — to ensure your portfolio remains resilient.

If you’d like to review your allocation, explore rebalancing, or talk about how these shifts affect your family’s plan, we’re here.

“The greatest danger in times of turbulence is not the turbulence — it is to act with yesterday’s logic.”
– Peter Drucker