In like a lion, beware the ides of March, welcome to March Madness. Whatever your chosen phrase, it seems like March is known for its headlines and potential for volatile events. The investment markets have certainly gotten the message as we move towards the end of the first quarter. 

As of this writing, the Nasdaq is down about 10%, the S&P 500 about 5% and the Rusell 2000 which tracks the small company index about 7%. So certainly not the start to the year in the markets that anyone would hope for. While this, along with the headlines and talking heads spurring things on, can be cause for concern or may make you question the plan that you have in place as always, we need to add context to anything that is going on when making our decisions. 

While the S&P 500 is down about 5% so far this year, from January 1 of 2024 it is currently up about 17.5%. So, without the recent sell off, if we had just quietly moved from January 1 of last year to where we are today, we would all be very happy with the current levels in the market, it is the recency bias that we all naturally have that causes us to focus on what has happened most recently without looking at the broad data. Movements in the market like this are very normal, and on average happen about every 8 months. The normal average peak to trough movement within a calendar year is about 14%, a number that we are trending towards, but that we are still a ways away from.  

Job and wage numbers continue to be solid and in a range that would point towards a solid and stable economy, even with the volatile noise out of Washington, it has yet to translate into the workforce in a disruptive way. Inflation continues to be higher than the Fed’s stated goal of 2%, but it remains below the more normal long-term averages for what inflation has been historically. We will have to wait and see what, if any, direct impact on inflation and tariff action will have on inflation and consumer pricing. 

New business investment in the United States this year stands at about $1.3 trillion since the middle of January. And while these projects take time to be built and come online, the opportunity for there to be continued strong economic growth and development is currently quite high.  

So definitely more to come on what direction the markets and the economy takes over the short term and the impacts any of that would have on the long-term outlook, we believe having a plan and making decisions based upon that plan will always yield the best outcomes.

As we move through 2025, we're excited to continue the conversation and see what the year brings. Stay tuned for more updates.

Remember: when in doubt, shut off the TV, throw away the newspaper, unplug the computer, put down the smart phone, and meet with your advisor when questions arise.  

Brandon Masbruch, CPFA

Vice-President & Chief Financial Officer

Certified Financial Fiduciary®

(608) 807-4775

brandon@mfgteam.com

www.mfgteam.com

2924 Marketplace Drive, Suite 200

Madison, WI 53719

Advisory services offered through Commonwealth Financial Network®, a Registered Investment Adviser.

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