It’s Halloween weekend and I’m sure many of you will be out and about enjoying the festivities. Celebrations on October 31st (the eve of the Western Christian feast of All Saints’ Day) marks the start of All Hallows' Day, a period during the liturgical year devoted to honoring the deceased, especially martyrs, saints (hallows), and all the faithful who have passed away. However you may choose to celebrate this day, stay safe and don’t forget to enjoy a special treat!
A House divided looks to have finally found a new leader. Republican Rep. Mike Johnson of Louisiana was elected speaker of the House of Representatives on Wednesday, ending a three-week leadership crisis that has paralyzed Congress. Johnson managed to “wrangle” the various factions within the Republican party and was able to secure all 220 votes needed. The timing is important as we get closer to the next potential Government shut down on November 17th. Johnson sent a letter to his colleagues shortly after taking office that outlined “a proposed temporary measure to fund the government through Jan. 15 or April 15, as the House works to pass the 12 appropriation bills needed to keep federal agencies running through the entire fiscal year.” This piece of legislation, along with funds asked from President Biden to support Israel and the Ukraine, will be on top of the agenda for now. While the dust may have settled for today, these discussions are far from over.
Thursday morning saw the release of the latest GDP numbers from the third quarter. Gross domestic product, a measure of all goods and services produced in the U.S., rose at a 4.9% annualized pace in the July-through-September period, up from the 2.1% pace in the second quarter. Economists surveyed by Dow Jones had been looking for a 4.7% acceleration. We have been saying this for some time and it continues to hold true and that is the resiliency of the consumer. The GDP increase marked the biggest gain since the fourth quarter of 2021, likely only throwing more fuel on the Fed’s fire to keep monetary policies tight. Consensus remains that no increase in the base rates will occur at next week’s Fed meeting, but perhaps the December year-end meeting will see a potential last increase and close the chapter on this cycle. I know we are all ready to move onward and upward with more clarity on that front!
As we move into November, earnings will remain in focus from a stock markets’ perspective. Thus far, things have been mostly better than expected, with a minimal number of surprises thrown in for good measure. Forward-looking guidance for the 4th quarter has seen more caution as some slowdown is occurring in certain spots but not enough to warrant a significant shift in expectations. Investors continue to closely watch what happens in the bond market, specifically the treasury market. Treasury yields have risen to their highest level in more than a decade and a half, further putting pressure on equities as investors shift parts of their portfolios to take advantage of these higher yields. Ultimately, we feel this is healthy and, for the first time in a long time, treasuries can play a significant role in our portfolios again, adding much needed stability.
Watch out for all of the ghouls and goblins as you enjoy this wonderful fall weather!
https://www.federalreserve.gov/publications/files/scf23.pdf
https://en.wikipedia.org/wiki/Halloween
Christopher E. Wasson, CFP®
President
Mosaic Asset Partners, LLC
1122 Kenilworth Drive, Suite 310
Towson, MD 21204
410.821.0089 fax 410.821.5993
MosaicAssetPartners.com
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