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Mosaic Weekly Article 05.12.2023

May 12, 2023

Happy Mother’s Day to the wonderful moms who so patiently look out and care for all of us. Patience being the key word, especially in my house with three very opinionated (and hungry) young men. See the link below for a few fun facts that relate to the origins of Mother’s Day. Did you know that the white carnation is the official flower to celebrate the day?

The debt ceiling and surrounding discussions have generated a lot of buzz over the week. After a brief and non-productive meeting on Tuesday, President Biden was scheduled to resume talks today with the respective House and Senate leaders. That meeting was postponed until next week and left some wondering about the next steps. With only a few weeks left before the debt ceiling extension expires and a potential default kicks in, it forces us to consider the potential “what-ifs”. The reality is that neither side wants a default or really wishes to risk the fallout that could ensue. Both sides know where they are willing to compromise, but let’s be honest here, there is no incentive to get a deal done today. Time for each side allows their respective agendas to take shape and the closer this gets to the deadline, the more likelihood that a satisfactory outcome will prevail. Keep in mind that even though the meeting scheduled for today was postponed, their staffs continue to negotiate behind the scenes. In some ways, a postponement could mean that while each side works through their respective ideals, a little more time is needed to bridge the gap before the real decision makers meet again early next week. A few more thoughts to consider.

  1. Neither side wants a default, period. The ramifications would be felt quickly and would likely accelerate a potential recession.
  2. A sitting President, heading into a re-election cycle, would not want to see the economy in a recession on his watch as voters make up their minds.
  3. As of now, our financial markets have barely taken notice. If there were “real” worries out there, the smart money would be moving to the sidelines.

The headlines on this topic will not ease anytime soon until a real compromise is reached. It is important to take a step back and look at the bigger picture. We don’t know at this point how it will all play out, but history once again may provide a guidepost. While it may be hard to not let the “worries” creep in, just be mindful of where and who you are receiving your information from. In our current, divided world, everyone has an agenda unfortunately.  

As always, we are here to address your concerns. We continue to actively monitor and manage the current environment as best we can. We remain encouraged to see inflation easing on many levels. While it certainly isn’t back to our pre-Covid days, the costs of many things are normalizing. I suspect that some things will remain elevated but not at the levels we experienced over the past year. The housing market, while slower than usual, remains tight. I have heard from many of our clients who are in the market that housing inventories remain tight and constrained. I don’t believe that issue will ease anytime soon. In fact, as interest rates stabilize and even pull back some in the months ahead, inventories will become even more constricted as buyers step back in. While our spending patterns adjust, our own personal new normal will settle in. Interesting times remain, but then again, isn’t that what we have come to expect?

Enjoy your loved ones and have a wonderful weekend!

https://www.goodhousekeeping.com/holidays/mothers-day/g32129906/mothers-day-origin/?utm_source=google&utm_medium=cpc&utm_campaign=arb_ga_ghk_md_pmx_us_urlx_19597983321&gclid=CjwKCAjwx_eiBhBGEiwA15gLNzihK_G80We-E6whITGDuNtHcxw5Xu1lTbYae8RzMrftxVB8Y43kNRoCpzgQAvD_BwE

https://www.cnbc.com/2023/05/10/april-2023-cpi-inflation-report.html

https://www.cnbc.com/2023/05/11/wholesale-prices-rose-just-0point2percent-in-april-less-than-estimate-as-inflation-pressures-ease.html

https://www.cnbc.com/2023/05/11/debt-ceiling-meeting-among-biden-and-congressional-leaders-postponed-until-next-week-source-says.html´╗┐

Christopher E. WassonCFP®

President

 Mosaic Asset Partners, LLC

                 1122 Kenilworth Drive, Suite 310

                 Towson, MD  21204

                 410.821.0089         fax 410.821.5993

                 MosaicAssetPartners.com  

                 

Securities offered through Kestra Investment Services, LLC (Kestra IS), member FINRA/SIPC. Investment advisory services offered through Kestra Advisory Services, LLC (Kestra AS), an affiliate of Kestra IS. Mosaic Asset Partners, LLC is not affiliated with Kestra IS or Kestra AS.  Investor Disclosures: https://www.kestrafinancial.com/disclosures

The opinions expressed in this commentary are those of the author and may not necessarily reflect those held by Kestra IS or Kestra AS. The material is for informational purposes only. It represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. It is not guaranteed by Kestra IS or Kestra AS for accuracy, does not purport to be complete and is not intended to be used as a primary basis for investment decisions. It should also not be construed as advice meeting the particular investment needs of any investor. Neither the information presented nor any opinion expressed constitutes a solicitation for the purchase or sale of any security.