Apparently, we all need to just stay calm and carry on! The financial world was a sea of green this week as the 3rd quarter earnings season kicked into high gear. Corporate profits remain robust, even in the face of rising prices and supply chain nightmares. Consumers continue to spend at a feverish pace and to top it off, travels restrictions for visitors coming into the U.S. will be lifted as of November 8th for those that are vaccinated. The dizzying array of headlines just keeps on rolling. If those stories weren’t enough to feel good about, the one from the Social Security Administration could be considered the icing on the cake.
Retirees will see the largest COLA (cost of living adjustment) increase to their monthly Social Security payments in 40 years. A whopping 5.9% increase will begin starting in January. For many, this will be a welcome relief given the backdrop of inflation and rising prices. For many Americans, Social Security is their only source of income in retirement. This substantial increase comes at a pivotal time as the cost of goods and services has been steadily rising over the past year. Now keep in mind, we generally also see an increase in Medicare costs and those have yet to be announced. Let’s just hope they don’t “match” the COLA adjustments as has been the case in years past. Any breathing room for those on fixed incomes is long overdue.
We continue to monitor the other ongoing events in Washington. The debt ceiling limits have only been temporarily lifted and are set to expire again in early December. We also have the overhang of the two separate infrastructure bills lingering on. With both sides of the aisle dug in, the battle is far from over and it seems like a showdown of all three of these events will bubble up very soon. While it is still too early to get a feel for where things may fall out, the deal making in Washington is no doubt in full swing. While the downward volatility in our stock markets looks to be in check for now, there is no doubt that the balance of this year will remain interesting. Our current investment philosophy remains intact, and we feel that we are positioned appropriately for the near-term. As more details emerge on any significant tax changes that may impact our financial markets we are prepared to adjust as needed. For now, the “Bull” is back, and idle money continues to drift in. Stay tuned, the story is far from over.
Have a great weekend!
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