Reality returns on Friday 3/28 as markets respond to tariff threats by Trump. The challenge is the high degree of uncertainty of what the Trump administration, in fact Trump himself will actually do. Reciprocal tariffs are set to start on April 2nd, but we have had repeated deadlines previously that Trump has changed at the last moment. The thinking by Wall Street is that tariffs were a negotiating tool, and deals would be worked out favorably to the United States. Turns out so far there are no deals that will prevent the April 2nd revenge day-at least so far.  In addition, inflation news has been lukewarm with inflation numbers above expectations as consumer confidence continues to fall. It is true consumer sentiment sometimes does not translate to consumer behavior.  That is yet to be determined.  Americans are also concerned about Social Security. Many offices are slated to be closed and the telephone lines designed to help disabled Americans have been restored after protests around a DOGE shutdown. The disruption leading to chaos continues as the Department of Health and Human services plans to lay off 10% of the workforce across all departments.  Research grants to universities and hospitals have been reduced or eliminated. The savings results are marginal to the US budget deficit but the impact on Americans will be felt in short order. Markets are concerned about inflation increasing and economic growth slowing.  The term “stagflation” is appearing more frequently.  In Trump 1.0 markets experience the stock market put meaning if the stock market drops, Trump will take action to stop its decline.  In Trump 2.0 this does not seem to be the case.  As of Friday, and as we near the end of March-the first quarter-SP 500 is heading back to correction territory meaning 10% off its high. The Nasdaq is still in correction territory as are mid and small cap domestic US stocks.  International stocks remain in positive territory for the year.  

One of the big questions for 2025 is how the Fed will respond with interest rates.  So far based on the last Fed meeting, 2 interest rate reductions are in store for 2025 however, finding the balance between increased inflation and slowing economic growth is a challenge.

IRA & Roth IRA contribution deadline is April 15th check Retirement Account Contribution Method Matrix here.

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