Archives: Insight

Weekly Market Insights – Monday, June 30, 2025

Markets Hold Broad-Based Rally:

Stocks rallied across the board last week as investor optimism grew over the potential for a sustained Middle East ceasefire, hitting new record highs along the way.
The S&P 500 Index rose 3.44%, while the Nasdaq Composite Index added 4.25%. The Dow Jones Industrial Average advanced 3.82%. The MSCI EAFE Index, which tracks developed overseas stock markets, increased 3.04%.1,2

Source: Bloomberg Finance, L.P. (Performance data normalized 6/20/25 = 0)

Stocks Push Higher

Last week opened with a rally powered by news of a tamer-than-expected escalation of tensions in the Middle East. Stocks continued their rise after this week’s ceasefire agreement, although Wall Street appeared concerned about whether the truce would remain in place.3,4
Sentiment brightened after the White House played down the approaching July 8 tariff deadlines. Solid corporate earnings, a still-strong labor market, and a recovery in artificial intelligence-related stocks provided some underlying strength to the rally.5
As the week wrapped up, the S&P 500 hit its first new high since February—it marked the fastest-ever recovery from a 15% decline for the broad-market index. The tech-heavy Nasdaq Composite also closed at an all-time high.6,7

Sources: U.S. Department of the Treasury, Board of Governors of the Federal Reserve System, Charles Schwab

Economic Data Helped, Too

While trade and Middle East updates powered most of the markets’ rise last week, a few economic bits of news also contributed to the week-long rally. For example, consumer sentiment climbed 16% in May—its first increase in six months.8,9
“The improvement was broad-based across numerous facets of the economy, with expectations for personal finances and business conditions climbing about 20% or more,” the University of Michigan said in a statement.

This Week: Key Economic Data

Source: Bloomberg Finance L.P.

This Week: Companies Reporting Earnings

Source: EarningsWhispers

Author

Gary Aiken
Chief Investment Officer
Concord Asset Management
—

Footnotes and Sources

1WSJ.com, June 27, 2025
2Investing.com, June 27, 2025
3CNBC.com, June 23, 2025
4CNBC.com, June 24, 2025
5WSJ.com, June 18, 2025
6WSJ.com, June 27, 2025
7WSJ.com, June 27, 2025
8WSJ.com, June 24, 2025
9UMich.edu, June 27, 2025

Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Concord Asset Management, or any non-investment related content, made reference to directly or indirectly in this article will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this article serves as the receipt of, or as a substitute for, personalized investment advice from Concord Asset Management. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing.

The companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of any specific securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. The forecasts or forward-looking statements are based on assumptions, may not materialize, and are subject to revision without notice. The market indexes discussed are unmanaged and generally considered representative of their respective markets. Index performance is not indicative of the past performance of a particular investment. Indexes do not incur management fees, costs, and expenses. Individuals cannot directly invest in unmanaged indexes. The Dow Jones Industrial Average is an unmanaged index that is generally considered representative of large-capitalization companies on the U.S. stock market. Nasdaq Composite is an index of the common stocks and similar securities listed on the NASDAQ stock market and is considered a broad indicator of the performance of technology and growth companies. The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) and serves as a benchmark of the performance of major international equity markets, as represented by 21 major MSCI indexes from Europe, Australia, and Southeast Asia. The S&P 500 Composite Index is an unmanaged group of securities that are considered to be representative of the stock market in general. U.S. Treasury Notes are guaranteed by the federal government as to the timely payment of principal and interest. However, if you sell a Treasury Note prior to maturity, it may be worth more or less than the original price paid. Fixed income investments are subject to various risks, including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications, and other factors. International investments carry additional risks, which include differences in financial reporting standards, currency exchange rates, political risks unique to a specific country, foreign taxes and regulations, and the potential for illiquid markets. These factors may result in greater share price volatility. Please consult your financial professional for additional information.

Concord Asset Management is neither a law firm, nor a certified public accounting firm, and no portion of the content should be construed as legal or accounting advice. A copy of Concord Asset Management’ current written disclosure Brochure discussing our advisory services and fees is available upon request or at https://concordwealthpartners.com/. Please Note: If you are a Concord Asset Management or Concord Wealth Partners client, please remember to contact the firm in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing, evaluating, and/or revising our previous recommendations and/or services, or if you would like to impose, add, or to modify any reasonable restrictions to our investment advisory services. Concord Asset Management and Concord Wealth Partners shall continue to rely on the accuracy of information that you have provided. Please Note: If you are a Concord Asset Management or Concord Wealth Partners client, please advise us if you have not been receiving account statements (at least quarterly) from the account custodian.

Weekly Market Insights – Monday, June 23, 2025

Conflict Concerns Shake Up Markets; Fed Holds Steady:

Stock performance was mixed during the holiday-shortened trading week as investor sentiment was clouded by lingering uncertainty in the Middle East and the Fed’s decision to leave interest rates unchanged.
The S&P 500 Index slipped by 0.15%, while the Nasdaq Composite Index rose by 0.21%. The Dow Jones Industrial Average was flat (+0.02 %). The MSCI EAFE Index, which tracks developed overseas stock markets, declined 1.54%.1,2

Source: Bloomberg Finance, L.P. (Performance data normalized 6/13/25 = 0)

Stocks Rise, Then Slump

Stocks opened higher, and oil prices fell at the start of the week as investors hoped Middle Eastern tensions would ease.3
However, as investors parsed through updates on the conflict, stocks fell over ongoing uncertainty. Conflicting statements from those involved, as well as from world leaders, contributed to the uncertainty.4
Midweek, stocks rallied ahead of the Fed’s interest rate decision. Markets seemed to dismiss news that housing starts dropped unexpectedly to their lowest level in five years.
The Fed held short-term rates steady. Stocks moved up and down during the Fed Chair’s press conference before ending the trading session slightly down ahead of Thursday’s stock market holiday.5
Following the holiday, anxious investors refocused on geopolitical tensions and developments. As the week closed out, investors appeared to take a risk-off approach heading into the weekend.6

Sources: U.S. Department of the Treasury, Board of Governors of the Federal Reserve System, Charles Schwab

The Fed Holds Rates Steady

As expected, the Federal Reserve kept the Fed funds rate at its target range of 4.25% and 4.5%. However, the central bank did suggest it may adjust rates later this year, and policymakers expressed concerns about inflation and the outlook for gross domestic product.
Following the decision, Fed Chair Powell said policymakers are “well positioned to wait” before moving on short-term rates. Powell indicated that trade policy has clouded the inflation outlook, making policymakers concerned about consumer price.7,8

This Week: Key Economic Data

Source: Bloomberg Finance L.P.

This Week: Companies Reporting Earnings

Source: EarningsWhispers

Author

Gary Aiken
Chief Investment Officer
Concord Asset Management
—

Footnotes and Sources

1WSJ.com, June 20, 2025
2Investing.com, June 20, 2025
3MarketWatch.com, June 16, 2025
4CNBC.com, June 17, 2025
5WSJ.com, June 18, 2025
6CNBC.com, June 20, 2025
7MarketWatch.com, June 16, 2025
8WSJ.com, June 18, 2025

Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Concord Asset Management, or any non-investment related content, made reference to directly or indirectly in this article will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this article serves as the receipt of, or as a substitute for, personalized investment advice from Concord Asset Management. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing.

The companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of any specific securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. The forecasts or forward-looking statements are based on assumptions, may not materialize, and are subject to revision without notice. The market indexes discussed are unmanaged and generally considered representative of their respective markets. Index performance is not indicative of the past performance of a particular investment. Indexes do not incur management fees, costs, and expenses. Individuals cannot directly invest in unmanaged indexes. The Dow Jones Industrial Average is an unmanaged index that is generally considered representative of large-capitalization companies on the U.S. stock market. Nasdaq Composite is an index of the common stocks and similar securities listed on the NASDAQ stock market and is considered a broad indicator of the performance of technology and growth companies. The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) and serves as a benchmark of the performance of major international equity markets, as represented by 21 major MSCI indexes from Europe, Australia, and Southeast Asia. The S&P 500 Composite Index is an unmanaged group of securities that are considered to be representative of the stock market in general. U.S. Treasury Notes are guaranteed by the federal government as to the timely payment of principal and interest. However, if you sell a Treasury Note prior to maturity, it may be worth more or less than the original price paid. Fixed income investments are subject to various risks, including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications, and other factors. International investments carry additional risks, which include differences in financial reporting standards, currency exchange rates, political risks unique to a specific country, foreign taxes and regulations, and the potential for illiquid markets. These factors may result in greater share price volatility. Please consult your financial professional for additional information.

Concord Asset Management is neither a law firm, nor a certified public accounting firm, and no portion of the content should be construed as legal or accounting advice. A copy of Concord Asset Management’ current written disclosure Brochure discussing our advisory services and fees is available upon request or at https://concordwealthpartners.com/. Please Note: If you are a Concord Asset Management or Concord Wealth Partners client, please remember to contact the firm in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing, evaluating, and/or revising our previous recommendations and/or services, or if you would like to impose, add, or to modify any reasonable restrictions to our investment advisory services. Concord Asset Management and Concord Wealth Partners shall continue to rely on the accuracy of information that you have provided. Please Note: If you are a Concord Asset Management or Concord Wealth Partners client, please advise us if you have not been receiving account statements (at least quarterly) from the account custodian.

Weekly Market Insights – Monday, June 16, 2025

Market Focus Shifts to Trade and Oil:

Stocks dipped last week following an up-and-down mix of trade developments, key economic updates, and ongoing geopolitical tensions that resulted in a lackluster week of trading.
The S&P 500 Index slid 0.39%, while the Nasdaq Composite Index slipped 0.63%. The Dow Jones Industrial Average declined 1.32%. The MSCI EAFE Index, which tracks developed overseas stock markets, edged down 0.18%.1,2

Source: Bloomberg Finance, L.P. (Performance data normalized 6/6/25 = 0)

Trade and Geopolitics Dominate Sessions

Stocks largely languished for the first half of the week as investors awaited news from U.S.-China trade talks and key inflation reports.3,4
Sentiment began to rise late Tuesday afternoon following upbeat comments about trade talks. Most of the market gains came before the U.S. and China separately announced the trade update, with little reaction when markets opened the next day.4
Stocks peaked midweek, then declined despite a May report showing consumer inflation rose less than expected. Markets then trended a bit higher after a better-than-expected wholesale inflation report.5
Beginning Friday morning, all three averages were under pressure all day following news of an escalated conflict in the Middle East. Oil prices pushed higher on Friday on supply concerns6

Sources: U.S. Department of the Treasury, Board of Governors of the Federal Reserve System, Charles Schwab

Brighter Notes

As the week ended with rising tensions in the Middle East, it was easy to overlook some good economic news.
First is inflation: both the Consumer Price Index (CPI) and the Producer Price Index (PPI) showed signs of cooling or holding steady. And both the CPI and PPI slightly beat expectations.
Second, consumers. Consumer sentiment jumped in May—the first such rise in six months. Economists took note, as consumer spending drives two-thirds of the U.S. economy.7

This Week: Key Economic Data

Source: Bloomberg Finance L.P.

This Week: Companies Reporting Earnings

Source: EarningsWhispers

Author

Gary Aiken
Chief Investment Officer
Concord Asset Management
—

Footnotes and Sources

1WSJ.com, June 13, 2025
2Investing.com, June 13, 2025
3CNBC.com, June 9, 2025
4WSJ.com, June 10, 2025
5CNBC.com, June 12, 2025
6CNBC.com, June 13, 2025
7WSJ.com, June 13, 2025

Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Concord Asset Management, or any non-investment related content, made reference to directly or indirectly in this article will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this article serves as the receipt of, or as a substitute for, personalized investment advice from Concord Asset Management. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing.

The companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of any specific securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. The forecasts or forward-looking statements are based on assumptions, may not materialize, and are subject to revision without notice. The market indexes discussed are unmanaged and generally considered representative of their respective markets. Index performance is not indicative of the past performance of a particular investment. Indexes do not incur management fees, costs, and expenses. Individuals cannot directly invest in unmanaged indexes. The Dow Jones Industrial Average is an unmanaged index that is generally considered representative of large-capitalization companies on the U.S. stock market. Nasdaq Composite is an index of the common stocks and similar securities listed on the NASDAQ stock market and is considered a broad indicator of the performance of technology and growth companies. The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) and serves as a benchmark of the performance of major international equity markets, as represented by 21 major MSCI indexes from Europe, Australia, and Southeast Asia. The S&P 500 Composite Index is an unmanaged group of securities that are considered to be representative of the stock market in general. U.S. Treasury Notes are guaranteed by the federal government as to the timely payment of principal and interest. However, if you sell a Treasury Note prior to maturity, it may be worth more or less than the original price paid. Fixed income investments are subject to various risks, including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications, and other factors. International investments carry additional risks, which include differences in financial reporting standards, currency exchange rates, political risks unique to a specific country, foreign taxes and regulations, and the potential for illiquid markets. These factors may result in greater share price volatility. Please consult your financial professional for additional information.

Concord Asset Management is neither a law firm, nor a certified public accounting firm, and no portion of the content should be construed as legal or accounting advice. A copy of Concord Asset Management’ current written disclosure Brochure discussing our advisory services and fees is available upon request or at https://concordwealthpartners.com/. Please Note: If you are a Concord Asset Management or Concord Wealth Partners client, please remember to contact the firm in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing, evaluating, and/or revising our previous recommendations and/or services, or if you would like to impose, add, or to modify any reasonable restrictions to our investment advisory services. Concord Asset Management and Concord Wealth Partners shall continue to rely on the accuracy of information that you have provided. Please Note: If you are a Concord Asset Management or Concord Wealth Partners client, please advise us if you have not been receiving account statements (at least quarterly) from the account custodian.

Weekly Market Insights – Monday, June 9, 2025

Trade Tensions Ease as Economic Data Rises:

Stocks climbed last week as investors reacted to a combination of upbeat economic data and easing trade tensions between the U.S. and other major global economies.
The S&P 500 Index added 1.50%, while the Nasdaq Composite Index rose 2.18%. The Dow Jones Industrial Average advanced 1.17 %. The MSCI EAFE Index, which tracks developed overseas stock markets, picked up 0.78%1,2

Source: Bloomberg Finance, L.P. (Performance data normalized 5/30/25 = 0)

S&P 500 Closes Above 6,000 (Again)

Early in the week, markets notched steady gains as investors awaited key economic indicators and monitored ongoing trade discussions. Mega cap tech names—particularly AI chipmakers—led the broader market higher, as sentiment stayed bullish on prospects for a U.S.-China trade deal.3
Midweek, however, concerns over tariffs and a notable decline in one mega cap tech stock slowed overall market momentum. Recent conversations between the U.S. and Chinese leadership helped investors envision progress toward a trade deal between the two nations.4,5
On Friday, stocks pushed higher following the release of the May jobs report, which showed an addition of 139,000 jobs, above expectations of 125,000. The S&P 500 closed above 6,000 for the first time since February—a key psychological hurdle for some market participants. And the Dow erased all its 2025 year-to-date losses.6,7

Sources: U.S. Department of the Treasury, Board of Governors of the Federal Reserve System, Charles Schwab

Jobs & Trade

Amid considerable market noise, stocks pushed higher last week. Here are three takeaways:
  • First, the upbeat jobs report was strong enough to ease some economic concerns.
  • Second, the jobs report showed that the unemployment rate held steady at 4.2%, and wage growth increased by 3.9% year-over-year. These figures also helped ease slowdown fears.7
  • Last, despite some political squabbles, trade talks progressed this week, with the U.S. striking a deal with Germany while continuing to move forward with China.8

This Week: Key Economic Data

Source: Bloomberg Finance L.P.

This Week: Companies Reporting Earnings

Source: EarningsWhispers

Author

Gary Aiken
Chief Investment Officer
Concord Asset Management
—

Footnotes and Sources

1WSJ.com, June 6, 2025
2Investing.com, June 6, 2025
3CNBC.com, June 3, 2025
4CNBC.com, June 5, 2025
5MarketWatch.com, June 5, 2025
6MarketWatch.com, June 6, 2025
7WSJ.com, June 6, 2025
8MarketWatch.com, June 6, 2025

Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Concord Asset Management, or any non-investment related content, made reference to directly or indirectly in this article will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this article serves as the receipt of, or as a substitute for, personalized investment advice from Concord Asset Management. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing.

The companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of any specific securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. The forecasts or forward-looking statements are based on assumptions, may not materialize, and are subject to revision without notice. The market indexes discussed are unmanaged and generally considered representative of their respective markets. Index performance is not indicative of the past performance of a particular investment. Indexes do not incur management fees, costs, and expenses. Individuals cannot directly invest in unmanaged indexes. The Dow Jones Industrial Average is an unmanaged index that is generally considered representative of large-capitalization companies on the U.S. stock market. Nasdaq Composite is an index of the common stocks and similar securities listed on the NASDAQ stock market and is considered a broad indicator of the performance of technology and growth companies. The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) and serves as a benchmark of the performance of major international equity markets, as represented by 21 major MSCI indexes from Europe, Australia, and Southeast Asia. The S&P 500 Composite Index is an unmanaged group of securities that are considered to be representative of the stock market in general. U.S. Treasury Notes are guaranteed by the federal government as to the timely payment of principal and interest. However, if you sell a Treasury Note prior to maturity, it may be worth more or less than the original price paid. Fixed income investments are subject to various risks, including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications, and other factors. International investments carry additional risks, which include differences in financial reporting standards, currency exchange rates, political risks unique to a specific country, foreign taxes and regulations, and the potential for illiquid markets. These factors may result in greater share price volatility. Please consult your financial professional for additional information.

Concord Asset Management is neither a law firm, nor a certified public accounting firm, and no portion of the content should be construed as legal or accounting advice. A copy of Concord Asset Management’ current written disclosure Brochure discussing our advisory services and fees is available upon request or at https://concordwealthpartners.com/. Please Note: If you are a Concord Asset Management or Concord Wealth Partners client, please remember to contact the firm in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing, evaluating, and/or revising our previous recommendations and/or services, or if you would like to impose, add, or to modify any reasonable restrictions to our investment advisory services. Concord Asset Management and Concord Wealth Partners shall continue to rely on the accuracy of information that you have provided. Please Note: If you are a Concord Asset Management or Concord Wealth Partners client, please advise us if you have not been receiving account statements (at least quarterly) from the account custodian.

U.S. Debt is Growing. Here’s How We’re Planning Around It.

By Gary Aiken | June 5, 2025

The most powerful think tanks in the United States are the Brookings Institution (on the left) and the Heritage Foundation (on the right). Can you imagine a single issue where these two groups would agree? In 2007, they agreed with former Comptroller of the Currency David Walker that the national debt was on an unsustainable path and that not dealing with spending issues would ultimately have significant negative consequences. In 2007, Walker led the effort to put together a movie which an unfortunately small audience viewed called “I.O.U.S.A.” At that time the national debt was $8.7 trillion, or 64.4% of GDP. Eighteen years later, the national debt is $36.9 trillion, or 122.9% of GDP. Neither Brookings nor Heritage, despite their enormous influence was any match for the spendthrift American voter.
Alexis de Tocqueville and Alexander Tytler wrote in the early 1800s that “A democracy… can only exist until the voters discover that they can vote themselves largesse from the public treasury. From that moment on, the majority always votes for the candidates promising the most benefits from the public treasury…” I’ve omitted the direst parts of the quote where Tytler concludes that the result is collapse and dictatorship, mostly because I’m an optimist and I think there’s a way out. However, the way through is bound to be messy.
In the 2000 election debates, George Bush and Saturday Night Live poked fun at Al Gore’s notion of a “lockbox” that held the enormous sums accumulated in the Social Security and Medicare trust funds. Of course, once we opened the proverbial box, all that remained were I.O.U.s from Congress. All the money’s gone. All that remains is a debt that must be paid.
And now we’ve passed the point of no return. Exacerbated by the pandemic, that point has come a few years earlier than expected. The sum of spending in Fiscal 2025 YTD (October to April) by the Department of Health and Human Services and Social Security Administration was $2T. Taxes to support mandatory Social Security and Medicare programs were only $1T. This number matches (almost exactly) the Fiscal Deficit for the same period.

Mandatory Spending is the Driver of Future Deficits

Source: Bureau of the Fiscal Service, U.S. Department of the Treasury, April 2025, Monthly Treasury Statement. Tables 1 and 9. Figures are Fiscal 2025 YTD.

Fiscal deficits going forward are not going to be the result of out-of-control discretionary spending or too-low-tax revenue. The main driver will be the imbalance between the working population paying into the social safety net and retired populations consuming their promised benefits. There’s no lockbox, so the government must borrow money every year for the next 20-plus years to fund the growing difference.
While artificial intelligence and innovation can bend the cost curve ever so slightly, demographics are the overwhelming force of actuarial nature propelling our nation’s finances. Larger deficits and debt are the future. The economic term that describes the ensuing effect is called “crowding out.” Interest rates on government debt will rise over time as investors require a higher rate. As this happens, more investors will choose to buy government bonds instead of investing in new projects whose returns are less competitive on a relative basis. This doesn’t mean that all resources go to buying government bonds, just that on the margin those decisions aren’t as easy as they were in the past. The growth rate of the economy doesn’t crash, but it slows. A slowing economy with less dynamism also means the government interest rate doesn’t need to climb a huge amount to present relative value.
One other fear that derives from the abundance of debt financing is that it will be accompanied by higher inflation. This does not necessarily need to be the case. Congress cannot print dollars; it has delegated that authority to the Federal Reserve. The inflation of 2021-23 was the direct result of the Federal Reserve buying 100% of the marginal supply of debt and issuing currency to the public to spend. If the Federal Reserve does its job prudently instead of the foolish way it acted in 2021-23 and does not monetize the coming wave of debt, then we should not see too much money chasing too few goods. Instead, we should see benefit dollars replacing salary income and chasing services (healthcare) spending in relatively equal proportion. If anything, we might expect the savings rate to increase and some of that money to be recycled into treasury bonds.
In the meantime, at Concord, we have made the following provisions generally in client model portfolios:
  1. We are short duration on bonds. We are buying corporate bonds with quality balance sheets in lieu of volatile long maturity treasuries.
  2. We have increased our holdings in non-U.S. stocks to diversify from U.S. dollar investments and to lessen overall volatility.
  3. We continue to believe that the artificial intelligence investment thesis is intact and that U.S. tech companies are still the overwhelming engine of productivity and profit growth.
There will be demand at some price to fund deficits as far as the eye can see. That price will be determined by interest rates, foreign exchange rates, or a combination of the two. There are an enormous number of complicated interactions between here and the point where there are more Millennials and Gen Zers working than Boomers in retirement. The actuarial pendulum will swing the other way. Will they have learned a lesson to save their surpluses for the next rainy day 100 years from now? Teach your children well. Our republic’s future depends on their collective decision.
This year so far has certainly been the “grind” we anticipated, with ample headline risk and increased volatility. I look forward to reviewing the first half of the year and extending our “crystal ball” to the second half with our clients in early July.

Author

Gary Aiken, Chief Investment Officer

Gary Aiken is the Chief Investment Officer for Concord Asset Management and is responsible for macroeconomic analysis, asset allocation, and security selection, as well as trading and investment operations.

Gary has over 21 years of investment experience and holds an undergraduate degree in economics from the University of Maryland and an MBA from The George Washington University School of Business.

—

Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Concord Asset Management, or any non-investment related content, made reference to directly or indirectly in this article will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this article serves as the receipt of, or as a substitute for, personalized investment advice from Concord Asset Management. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. Concord Asset Management is neither a law firm, nor a certified public accounting firm, and no portion of this content should be construed as legal or accounting advice. A copy of Concord Asset Management’ current written disclosure Brochure discussing our advisory services and fees is available upon request or at www.concordassetmgmt.com. Please Note: If you are a Concord Asset Management or Concord Wealth Partners client, please remember to contact the firm in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing, evaluating, and/or revising our previous recommendations and/or services, or if you would like to impose, add, or to modify any reasonable restrictions to our investment advisory services. Concord Asset Management and Concord Wealth Partners shall continue to rely on the accuracy of information that you have provided. Please Note: If you are a Concord Asset Management or Concord Wealth Partners client, please advise us if you have not been receiving account statements (at least quarterly) from the account custodian.

Weekly Market Insights – Monday, June 2, 2025

Markets Surge Amid U.S.-E.U. Trade Talks:

Stocks advanced over the shortened trading week, fueled by optimism over a potential trade agreement with the European Union (E.U.) and a strong earnings report from a mega-cap tech giant that manufactures semiconductors used in the development of artificial intelligence.
The S&P 500 Index rose 1.87%, while the Nasdaq Composite Index popped 2.01%. The Dow Jones Industrial Average advanced 1.60%. The MSCI EAFE Index, which tracks developed overseas stock markets, inched up 0.84%.1,2

Source: Bloomberg Finance, L.P. (Performance data normalized 5/23/25 = 0)

E.U. Trades Spark Stocks

On Monday, stocks bolted out of the gate on news that the European Union agreed to speed up trade talks with the U.S. By the end of the session, the S&P 500 and Nasdaq posted gains north of 2%.3
Stocks fell following Wednesday’s release of minutes from the Fed meeting in May, which showed Fed officials are cautious. Some fear that trade-related economic uncertainty could increase inflation and impact the labor market.4,5
On Friday, stocks were flat despite the White House accusing China of violating its trade deal. The S&P 500 added 6.2% and the Nasdaq 9.6% for the month, their best since November 2023.6

Sources: U.S. Department of the Treasury, Board of Governors of the Federal Reserve System, Charles Schwab

Inflation Update

The Fed’s preferred inflation measure—the Personal Consumption and Expenditures (PCE) Index—was released on Friday, showing only a modest uptick in prices in April.7
PCE increased 0.1% for the month, putting the annual rate at 2.1%—the lowest since September 2024.
On the expenditures side, the report shows a higher consumer saving rate as they navigate economic uncertainty.8

This Week: Key Economic Data

Source: Bloomberg Finance L.P.

This Week: Companies Reporting Earnings

Source: EarningsWhispers

Author

Gary Aiken
Chief Investment Officer
Concord Asset Management
—

Footnotes and Sources

1WSJ.com, May 30, 2025
2Investing.com, May 30, 2025
3WSJ.com, May 27, 2025
4CNBC.com, May 28, 2025
5CNBC.com, May 29, 2025
6WSJ.com, May 30, 2025
7MarketWatch.com, May 30, 2025
8MarketWatch.com, May 30, 2025

Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Concord Asset Management, or any non-investment related content, made reference to directly or indirectly in this article will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this article serves as the receipt of, or as a substitute for, personalized investment advice from Concord Asset Management. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing.

The companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of any specific securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. The forecasts or forward-looking statements are based on assumptions, may not materialize, and are subject to revision without notice. The market indexes discussed are unmanaged and generally considered representative of their respective markets. Index performance is not indicative of the past performance of a particular investment. Indexes do not incur management fees, costs, and expenses. Individuals cannot directly invest in unmanaged indexes. The Dow Jones Industrial Average is an unmanaged index that is generally considered representative of large-capitalization companies on the U.S. stock market. Nasdaq Composite is an index of the common stocks and similar securities listed on the NASDAQ stock market and is considered a broad indicator of the performance of technology and growth companies. The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) and serves as a benchmark of the performance of major international equity markets, as represented by 21 major MSCI indexes from Europe, Australia, and Southeast Asia. The S&P 500 Composite Index is an unmanaged group of securities that are considered to be representative of the stock market in general. U.S. Treasury Notes are guaranteed by the federal government as to the timely payment of principal and interest. However, if you sell a Treasury Note prior to maturity, it may be worth more or less than the original price paid. Fixed income investments are subject to various risks, including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications, and other factors. International investments carry additional risks, which include differences in financial reporting standards, currency exchange rates, political risks unique to a specific country, foreign taxes and regulations, and the potential for illiquid markets. These factors may result in greater share price volatility. Please consult your financial professional for additional information.

Concord Asset Management is neither a law firm, nor a certified public accounting firm, and no portion of the content should be construed as legal or accounting advice. A copy of Concord Asset Management’ current written disclosure Brochure discussing our advisory services and fees is available upon request or at https://concordwealthpartners.com/. Please Note: If you are a Concord Asset Management or Concord Wealth Partners client, please remember to contact the firm in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing, evaluating, and/or revising our previous recommendations and/or services, or if you would like to impose, add, or to modify any reasonable restrictions to our investment advisory services. Concord Asset Management and Concord Wealth Partners shall continue to rely on the accuracy of information that you have provided. Please Note: If you are a Concord Asset Management or Concord Wealth Partners client, please advise us if you have not been receiving account statements (at least quarterly) from the account custodian.

Weekly Market Insights – Tuesday, May 27, 2025

Markets React to Renewed Tariff Talks:

Stocks declined last week as fiscal concerns and renewed tariff tensions weighed on market sentiment and dampened investor confidence.
The S&P 500 Index fell 2.61%, while the Nasdaq Composite Index dropped 2.47%. The Dow Jones Industrial Average slid 2.47%. The MSCI EAFE Index, which tracks developed overseas stock markets, advanced 1.14%.1,2

Source: Bloomberg Finance, L.P. (Performance data normalized 5/16/25 = 0)

Stocks Slip

On Monday, stocks were under a bit of pressure after credit rating agency Moody’s downgraded the U.S. as an issuer of government bonds.3,4
Stocks remained under pressure midweek as Treasury yields moved higher with the 30-year bond hit a 19-month high. Investors fretted about the budget deficit; some feared the deficit would be made worse by the spending bill winding its way through Congress. After the House of Representatives approved the bill, bond yields backed off their highs and stocks went sideways.5,6
On Friday, stocks dropped after President Trump warned of a 50% tariff on European Union goods following an apparent stall in trade negotiations. At the same time, the administration also threatened a 25% tariff on any iPhones manufactured outside of the U.S.7

Sources: U.S. Department of the Treasury, Board of Governors of the Federal Reserve System, Charles Schwab

Unexpected Tariff News

The president’s fresh tariff talk ended a week or so of relative tranquility on the trade front. While the EU tariff threat may end with a deal similar to deals with other countries and regions, the iPhone issue may prove stickier.
Some analysts estimate that making iPhones in the U.S. would increase manufacturing costs by as much as 50%, which might increase the price of an iPhone.8

This Week: Key Economic Data

Source: Bloomberg Finance L.P.

This Week: Companies Reporting Earnings

Source: EarningsWhispers

Author

Gary Aiken
Chief Investment Officer
Concord Asset Management
—

Footnotes and Sources

1WSJ.com, May 23, 2025
2Investing.com, May 23, 2025
3CNBC.com, May 19, 2025
4CNBC.com, May 20, 2025
5CNBC.com, May 21, 2025
6CNBC.com, May 22, 2025
7WSJ.com, May 23, 2025
8MarketWatch.com, May 23, 2025

Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Concord Asset Management, or any non-investment related content, made reference to directly or indirectly in this article will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this article serves as the receipt of, or as a substitute for, personalized investment advice from Concord Asset Management. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing.

The companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of any specific securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. The forecasts or forward-looking statements are based on assumptions, may not materialize, and are subject to revision without notice. The market indexes discussed are unmanaged and generally considered representative of their respective markets. Index performance is not indicative of the past performance of a particular investment. Indexes do not incur management fees, costs, and expenses. Individuals cannot directly invest in unmanaged indexes. The Dow Jones Industrial Average is an unmanaged index that is generally considered representative of large-capitalization companies on the U.S. stock market. Nasdaq Composite is an index of the common stocks and similar securities listed on the NASDAQ stock market and is considered a broad indicator of the performance of technology and growth companies. The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) and serves as a benchmark of the performance of major international equity markets, as represented by 21 major MSCI indexes from Europe, Australia, and Southeast Asia. The S&P 500 Composite Index is an unmanaged group of securities that are considered to be representative of the stock market in general. U.S. Treasury Notes are guaranteed by the federal government as to the timely payment of principal and interest. However, if you sell a Treasury Note prior to maturity, it may be worth more or less than the original price paid. Fixed income investments are subject to various risks, including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications, and other factors. International investments carry additional risks, which include differences in financial reporting standards, currency exchange rates, political risks unique to a specific country, foreign taxes and regulations, and the potential for illiquid markets. These factors may result in greater share price volatility. Please consult your financial professional for additional information.

Concord Asset Management is neither a law firm, nor a certified public accounting firm, and no portion of the content should be construed as legal or accounting advice. A copy of Concord Asset Management’ current written disclosure Brochure discussing our advisory services and fees is available upon request or at https://concordwealthpartners.com/. Please Note: If you are a Concord Asset Management or Concord Wealth Partners client, please remember to contact the firm in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing, evaluating, and/or revising our previous recommendations and/or services, or if you would like to impose, add, or to modify any reasonable restrictions to our investment advisory services. Concord Asset Management and Concord Wealth Partners shall continue to rely on the accuracy of information that you have provided. Please Note: If you are a Concord Asset Management or Concord Wealth Partners client, please advise us if you have not been receiving account statements (at least quarterly) from the account custodian.

Weekly Market Insights – Monday, May 19, 2025

U.S.-China Tariff Deal Eases Market Tensions:

Stocks surged last week, fueled by optimism over positive trade developments and an encouraging inflation report.
The S&P 500 Index rose 5.27% while the Nasdaq Composite Index spiked 7.15%. The Dow Jones Industrial Average added 3.41%. The MSCI EAFE Index, which tracks developed overseas stock markets, increased 0.80 percent.1,2

Source: Bloomberg Finance, L.P. (Performance data normalized 5/9/25 = 0)

S&P, Dow Erase YTD Losses

Stocks pushed higher on Monday as investors cheered weekend news that the U.S. and China temporarily agreed to back off steep reciprocal tariffs.3
Then, a mild inflation report for April—the slowest annualized Consumer Price Index (CPI) reading in four years—boosted markets on Tuesday. Tech stocks powered the rally as the S&P 500 closed trading in the green for the year.4,5
Friday was the Dow’s turn to erase year-to-date losses and get back in the green while the Nasdaq and S&P notched a five-day winning streak.6
Markets closed the week with modest gains, largely looking past weak consumer sentiment data released on Friday.

Sources: U.S. Department of the Treasury, Board of Governors of the Federal Reserve System, Charles Schwab

All Eyes on Economic Data

The retail (CPI) and wholesale inflation reports (Producer Price Index) were mild, although most economists didn’t expect tariffs to impact prices in the first month of implementation.
Retail sales ticked up slightly (as expected), while industrial production and housing starts showed signs of tariff impact.7,8
Expect traders to continue to closely watch economic reports to better understand whether tariffs are showing up in the data.

This Week: Key Economic Data

Source: Bloomberg Finance L.P.

This Week: Companies Reporting Earnings

Source: EarningsWhispers

Author

Gary Aiken
Chief Investment Officer
Concord Asset Management
—

Footnotes and Sources

1WSJ.com, May 16, 2025
2Investing.com, May 16, 2025
3CNBC.com, May 12, 2025
4WSJ.com, May 13, 2025
5CNBC.com, May 15, 2025
6MarketWatch.com, May 16, 2025
7WSJ.com, May 13, 2025
8MarketWatch.com, May 16, 2025

Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Concord Asset Management, or any non-investment related content, made reference to directly or indirectly in this article will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this article serves as the receipt of, or as a substitute for, personalized investment advice from Concord Asset Management. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing.

The companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of any specific securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. The forecasts or forward-looking statements are based on assumptions, may not materialize, and are subject to revision without notice. The market indexes discussed are unmanaged and generally considered representative of their respective markets. Index performance is not indicative of the past performance of a particular investment. Indexes do not incur management fees, costs, and expenses. Individuals cannot directly invest in unmanaged indexes. The Dow Jones Industrial Average is an unmanaged index that is generally considered representative of large-capitalization companies on the U.S. stock market. Nasdaq Composite is an index of the common stocks and similar securities listed on the NASDAQ stock market and is considered a broad indicator of the performance of technology and growth companies. The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) and serves as a benchmark of the performance of major international equity markets, as represented by 21 major MSCI indexes from Europe, Australia, and Southeast Asia. The S&P 500 Composite Index is an unmanaged group of securities that are considered to be representative of the stock market in general. U.S. Treasury Notes are guaranteed by the federal government as to the timely payment of principal and interest. However, if you sell a Treasury Note prior to maturity, it may be worth more or less than the original price paid. Fixed income investments are subject to various risks, including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications, and other factors. International investments carry additional risks, which include differences in financial reporting standards, currency exchange rates, political risks unique to a specific country, foreign taxes and regulations, and the potential for illiquid markets. These factors may result in greater share price volatility. Please consult your financial professional for additional information.

Concord Asset Management is neither a law firm, nor a certified public accounting firm, and no portion of the content should be construed as legal or accounting advice. A copy of Concord Asset Management’ current written disclosure Brochure discussing our advisory services and fees is available upon request or at https://concordwealthpartners.com/. Please Note: If you are a Concord Asset Management or Concord Wealth Partners client, please remember to contact the firm in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing, evaluating, and/or revising our previous recommendations and/or services, or if you would like to impose, add, or to modify any reasonable restrictions to our investment advisory services. Concord Asset Management and Concord Wealth Partners shall continue to rely on the accuracy of information that you have provided. Please Note: If you are a Concord Asset Management or Concord Wealth Partners client, please advise us if you have not been receiving account statements (at least quarterly) from the account custodian.

Weekly Market Insights – Monday, May 12, 2025

Fed Talk Helps Ease Market Volatility:

Stocks finished lower last week as volatility eased despite ongoing trade concerns and the Federal Reserve’s latest decision on short-term interest rates.
The Dow Jones Industrial Average added 0.16%, while the S&P 500 Index lost 0.47 %. The tech-heavy Nasdaq Composite Index slipped 0.27%. The MSCI EAFE Index, which tracks developed overseas stock markets, fell 0.37%.1,2

Source: Bloomberg Finance, L.P. (Performance data normalized 5/2/25 = 0)

Stocks Go Sideways

Stocks dropped on Monday, ending the S&P 500’s 9-day winning streak as the trade anxiety weighed on investors.3,4
Sentiment picked up midweek, however. In a widely expected move, the Fed held short-term interest rates steady but warned of lingering uncertainty around tariffs’ effects on inflation and unemployment.5,6
On Thursday, the U.S.-U.K. trade deal sparked a slight rally, but stocks flattened as the week ended. Investors appeared to be risk-averse with U.S.-China trade talks scheduled for the weekend.7

Sources: U.S. Department of the Treasury, Board of Governors of the Federal Reserve System, Charles Schwab

The Fed Fans Out

The Federal Reserve wanted to get its message out last week. Within 48 hours of the Fed’s decision to leave interest rates unchanged, nearly every Fed governor gave a solo speech or discussed the decision on a panel.
One Fed official spoke about the benefits of long-term stability from an independent Fed. At the same time, another said the Fed was paying close attention to what consumers did—and not just what they said, suggesting that flagging consumer sentiment didn’t necessarily mean a slowdown in spending.7
The Fed seemed to focus on managing expectations. Perhaps more importantly, Fed officials spoke from a coordinated playbook, possibly designed to help settle financial markets.

This Week: Key Economic Data

Source: Bloomberg Finance L.P.

This Week: Companies Reporting Earnings

Source: EarningsWhispers

Author

Gary Aiken
Chief Investment Officer
Concord Asset Management
—

Footnotes and Sources

1The Wall Street Journal, May 9, 2025
2Investing.com, May 9, 2025
3CNBC.com, May 5, 2025
4CNBC.com, May 6, 2025
5The Wall Street Journal, May 7, 2025
6CNBC.com, May 8, 2025
7The Wall Street Journal, May 9, 2025

Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Concord Asset Management, or any non-investment related content, made reference to directly or indirectly in this article will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this article serves as the receipt of, or as a substitute for, personalized investment advice from Concord Asset Management. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing.

The companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of any specific securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. The forecasts or forward-looking statements are based on assumptions, may not materialize, and are subject to revision without notice. The market indexes discussed are unmanaged and generally considered representative of their respective markets. Index performance is not indicative of the past performance of a particular investment. Indexes do not incur management fees, costs, and expenses. Individuals cannot directly invest in unmanaged indexes. The Dow Jones Industrial Average is an unmanaged index that is generally considered representative of large-capitalization companies on the U.S. stock market. Nasdaq Composite is an index of the common stocks and similar securities listed on the NASDAQ stock market and is considered a broad indicator of the performance of technology and growth companies. The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) and serves as a benchmark of the performance of major international equity markets, as represented by 21 major MSCI indexes from Europe, Australia, and Southeast Asia. The S&P 500 Composite Index is an unmanaged group of securities that are considered to be representative of the stock market in general. U.S. Treasury Notes are guaranteed by the federal government as to the timely payment of principal and interest. However, if you sell a Treasury Note prior to maturity, it may be worth more or less than the original price paid. Fixed income investments are subject to various risks, including changes in interest rates, credit quality, inflation risk, market valuations, prepayments, corporate events, tax ramifications, and other factors. International investments carry additional risks, which include differences in financial reporting standards, currency exchange rates, political risks unique to a specific country, foreign taxes and regulations, and the potential for illiquid markets. These factors may result in greater share price volatility. Please consult your financial professional for additional information.

Concord Asset Management is neither a law firm, nor a certified public accounting firm, and no portion of the content should be construed as legal or accounting advice. A copy of Concord Asset Management’ current written disclosure Brochure discussing our advisory services and fees is available upon request or at https://concordwealthpartners.com/. Please Note: If you are a Concord Asset Management or Concord Wealth Partners client, please remember to contact the firm in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing, evaluating, and/or revising our previous recommendations and/or services, or if you would like to impose, add, or to modify any reasonable restrictions to our investment advisory services. Concord Asset Management and Concord Wealth Partners shall continue to rely on the accuracy of information that you have provided. Please Note: If you are a Concord Asset Management or Concord Wealth Partners client, please advise us if you have not been receiving account statements (at least quarterly) from the account custodian.

Tariffs and Deals: Can You Put the Genie Back in the Bottle?

By Gary Aiken | May 8, 2025

The tariff announcements on Liberation Day were bigger and bolder than anything Wall Street had imagined. Since then, I’ve cataloged the desperate rationalization of bad policy. Some ascribe goals post-hoc to the tariffs, and others to justify the base illiteracy of the initial tariff schedule. We must recognize that tariffs are a new, semi-permanent reality. Pro-tariff arguments fall into two categories: geopolitical and domestic.
The geopolitical arguments revolve around using tariffs, mostly against China.
  • We must change trade patterns because countries are “ripping us off.”
  • Tariffs are a negotiating ploy, and China will cave first.
  • Tariffs will align our trading partners against China.
The trade imbalances that have arisen since China’s entry into the WTO have become quite enormous. China is a bad actor. They steal technology, dump cheap goods, hide spyware in products, and use near-slave labor and dangerous chemicals in production, among other nasty habits. Further, the Chinese have been using their economic and military power to encroach upon our allies in Southeast Asia and around the world. Confronting China has been a growing and bi-partisan theme and effort in the United States. Convincing our friends and partners to join us has been difficult as Europe has grown increasingly dependent on China.
Tariffs on Chinese imports will have a serious and detrimental effect on trade and costs. We are already seeing slowdowns in our West Coast ports and trucking demand. While companies (like Apple and Williams-Sonoma, to name two in our portfolios) have been diversifying their supply chains, China remains a large part of the global supply chain, and it will be difficult and costly to extricate. The Trump Administration seems willing to help companies with significant political influence on a case-by-case basis. Still, the determination to change Chinese behavior seems like it will be with us for some longer period.
That said, what are the key takeaways from the geopolitical arguments?
  • We should expect that the cost of goods in the Chinese supply chain will rise significantly, and those prices will be reflected in lower gross margins and higher prices for the consumer.
  • Investment in diversifying supply chains will accelerate – whether it’s to friendshoring, nearshoring, or onshoring.
Let’s move on to the second argument: Tariffs will be good for the domestic economy.
  • Tariffs will raise revenue, and that will allow us to cut taxes.
  • Tariffs won’t be inflationary.
  • Companies will adjust to tariffs; there won’t be any serious consequences.
  • We are “Volckering ourselves.” Tanking the economy to lower interest rates and lower interest rates are necessary.
I think the argument that the Smoot Hawley tariffs were the cause of the Great Depression is overwrought. There’s greater evidence that other factors were more significant — especially the intransigence of the Federal Reserve (I’d point our readers to the book Lords of Finance by Liaquat Ahamed for a thorough case). Tariffs will raise revenue, although that revenue will be offset by lower economic activity overall. Lower economic activity means lower tax revenues and, in today’s situation, greater fiscal deficits. While fiscal deficits aren’t inflationary all by themselves, they certainly won’t lead to lower interest rates or less inflation.
Companies in the supply chain of tariffs will be forced to make choices about how to deal with the increased cost of goods. There are only so many ways to squeeze a balloon without it popping. Retailers report earnings at the end of earnings season, and some were forthcoming about how they would deal with tariffs. Williams-Sonoma gave us a six-point plan that isn’t revolutionary but revelatory and likely representative of the conversations in every company’s top management.

Source: Williams-Sonoma, Inc. 2025 Investor Presentation, March 19, 2025

As for the final point about “Volckering” ourselves. Inducing a recession is a dicey proposition. Fed Chair Volcker did it with the blessing of Presidents Carter and Reagan. Inflation was running double digits, and a jarring of the economy was necessary. Today, inflation is running at 3% and unemployment at 4.2%. It seems hardly necessary to induce a recession to bring rates down from 4.5% to potentially 3.5%. Also, having a recession while the federal deficit is already near 6% of GDP seems more likely to raise suspicion that the Federal Debt is out of control and that long-term interest rates should rise significantly to compensate for dubious policy goals.
The key takeaways from the domestic arguments are:
  • Tariff revenues will likely come in lower than expected, as tariffs tend to reduce overall economic activity and may lead to a decline in general tax revenue. Without spending cuts, deficits will grow larger.
  • Inducing recession fears to provoke a central bank response is unlikely to work and could backfire if a recession materializes.
We do not have a crystal ball, but we do have the ability to assign probabilities to various scenarios. At the beginning of 2025, we told clients to prepare for greater volatility as this year would likely be a grind. April brought showers of volatility from the Liberation Day tariff announcements. May flowers might sprout in the form of deals to ameliorate the markets’ fears.

Author

Gary Aiken, Chief Investment Officer

Gary Aiken is the Chief Investment Officer for Concord Asset Management and is responsible for macroeconomic analysis, asset allocation, and security selection, as well as trading and investment operations.

Gary has over 21 years of investment experience and holds an undergraduate degree in economics from the University of Maryland and an MBA from The George Washington University School of Business.

—

Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Concord Asset Management, or any non-investment related content, made reference to directly or indirectly in this article will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this article serves as the receipt of, or as a substitute for, personalized investment advice from Concord Asset Management. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. Concord Asset Management is neither a law firm, nor a certified public accounting firm, and no portion of this content should be construed as legal or accounting advice. A copy of Concord Asset Management’ current written disclosure Brochure discussing our advisory services and fees is available upon request or at www.concordassetmgmt.com. Please Note: If you are a Concord Asset Management or Concord Wealth Partners client, please remember to contact the firm in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing, evaluating, and/or revising our previous recommendations and/or services, or if you would like to impose, add, or to modify any reasonable restrictions to our investment advisory services. Concord Asset Management and Concord Wealth Partners shall continue to rely on the accuracy of information that you have provided. Please Note: If you are a Concord Asset Management or Concord Wealth Partners client, please advise us if you have not been receiving account statements (at least quarterly) from the account custodian.