Michael Carrico

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Navigating 2025 Market Volatility: Financial Strategies for Investors 

Watching stock prices fall is an uncomfortable experience for investors no matter the circumstances under which it occurs. It can feel uncontrollable and make us feel powerless over something so incredibly important to our futures. It’s perfectly reasonable to dislike that experience. As I’m checking in with my clients, I want to hear how they are feeling right now. No matter what emotions you are experiencing, it’s healthy to share that experience and maybe to get another perspective. There is some common wisdom which circulates widely in times like these, “just don’t look.” That can certainly be good advice for the right kind of person, but it might not work for everyone. Sometimes having something to do can help us feel a sense of agency in turbulent times and alleviate some discomfort. With that in mind, I want to share with you my list of action items for periods of market volatility. Hopefully, you will find a tip or two to help you feel empowered.

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Street$marts: What to Expect When Receiving an Inheritance

People I speak with have often thought a lot about leaving an inheritance. I encourage all my clients to check their beneficiaries, make an estate plan, and review and revise it, as necessary. However, it’s not as often that I have a conversation with someone planning to be on the other side of those estate plans. Although many of us may find ourselves as the beneficiary of an inheritance at some point in our lives, it’s less common to have a plan for that event.

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Attention-Grabbing Headlines: Unemployment, the Sahm Rule, and the Yen

Any time the market makes big moves, specifically big negative moves, people are going to try to find the “why” behind the price action. It’s human nature. We love to find patterns and meaning. As I have said before, it is a worthwhile practice to understand the reason for market moves because it can demystify them and make them more bearable. However, it can also be a source of anxiety to be steeped in headlines which are designed to manipulate emotions. There has been no shortage of headlines in the last two weeks. Last week we had the Federal Reserve policy meeting, and they held rates steady while opening the door for near-term rate cuts without outright promising them. That same day, the Bank of Japan surprised markets with a rate hike and the yen began to rally relative to the U.S. dollar. Technology companies with an AI angle have been pillars of U.S. stock market performance since early last year and we received some disappointment in earnings releases from a handful of those companies which poured some cold water on AI enthusiasm. We have seen headlines of escalating tensions in the Middle East. There is news of a delayed launch on a new chip from Nvidia. There was a weak employment report on Friday. News came out over the weekend that Warren Buffett’s Berkshire Hathaway had sold a sizeable portion of its stake in Apple and raised cash to a record high. When the Oracle of Omaha makes moves, investors take notice. Amid the volatility on Monday there were headlines about recession risk, emergency Fed rate cuts, the yield curve, and the Sahm Rule. In short, it’s been noisy, and investors could pick a topic to worry about. We can’t cover all these topics, but let’s examine two of the more complicated ones, the Sahm Rule and the yen carry trade, and try to put them in context.

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Coming Up From Behind: What’s the Story With Small-Cap Stocks?

The S&P 500 and Nasdaq Composite indexes tend to take up most of the oxygen in the room when talking about the stock market and that can leave other stories untold. So today, let’s peel back the onion and see what’s going on elsewhere in the stock market, ask why that might be happening, and whether that means anything going forward.

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Sowing Season

I write these articles once a month and my goal is to keep my readers informed. Those readers are, for the most part, clients, colleagues, and friends. That information is typically about the financial markets, about trends, about how I’m approaching a given topic, and about the big picture of finances. There is often a running theme of examining a claim or ill-defined story driven by headlines or sound bites and digging deeper. The market is an inherently noisy thing. There is always something new to grab our attention, always someone making a claim that this is the thing we really must heed. Really! It is worthwhile to examine those stories and claims and see what we can learn, but it’s also easy to get lost in the noise and become distracted from the places our attention really belongs.

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What the Heck is Stagflation?

There has been some talk of stagflation this year and it finally became enough for Federal Reserve Chair Jerome Powell to comment on it. It seems to me that a lot of financial jargon gets tossed about without consideration for the fact that most people didn’t go to school for economics or get a job in finance. So, since it’s in the zeitgeist, maybe it’s time to define some terms and get to the bottom of a couple of questions. What is stagflation? Is it occurring in the U.S. right now?

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Why is the Market Falling?

Any time the stock market falls for several days in a row, investors are bound to wonder what’s causing the volatility, even if they aren’t necessarily worried about it. I have not had many clients, friends, or family members ask me about the recent losses in the stock market yet, which I take to mean that most people aren’t that concerned. However, if the trend continues, it’s only a matter of time before I will be talking about the markets at dinner parties. Our readers and clients know that we think and invest long-term, but I always tell my clients that I want them to know why we’re doing what we’re doing. An informed investor is a more confident investor. With that in mind, let’s examine the recent price action in the markets, discuss what might be causing the reaction, and try to understand what the future may hold.

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Investors, Speculators, and Irrational Markets: Why We Focus on the Long-Term

Among my friends in the industry, we tend to challenge one another’s thinking and ask interesting questions just for fun. Well, I call it fun, though our significant others may beg to differ when it comes up at dinner parties. Lately there have been several discussions about whether current prices are justified by underlying fundamentals and one friend even suggested he may use some “fun money” to short NVDA. This inevitably led my other friend to a quote he has revisited often as of late…

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How Are the Magnificent 7 Faring Through Earnings Season?

The S&P 500 closed last week down 0.42% ending a five-week winning streak and pulling back from a string of record-breaking highs. The dour mood continued into the beginning of this week and the S&P 500 only barely squeaked out a positive return in the last few minutes of trading on Wednesday leading up to the Nvidia earnings release only to turn on a dime and power back on Thursday. There are explanations for this activity which I’ll explore below. However, the bottom line is that volatility is back in the markets, and we are seeing that in the reactions to earnings announcements this quarter. As of Wednesday night, the companies dubbed the Magnificent 7 have all reported earnings and they seem as good an example as any to explore how changing expectations are impacting stock prices.

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