Weekly Market Recap
Prefer Video? Click HERE and subscribe to our YouTube Channel.
This past week brought some notable shifts in the economic landscape, and as always, I want to keep you informed on what’s happening and how it could impact your financial plan.
The Week in Review
The housing market continues to adjust, with housing starts declining 9.8% month-over-month. Meanwhile, initial jobless claims rose to 219,000, signaling potential softening in the labor market.
On the economic activity front, the Flash Manufacturing PMI came in at 51.6, showing modest expansion, while the Services PMI dipped to 49.7, indicating a slight contraction in the service sector. These numbers highlight the mixed economic environment we’re navigating.
The Week Ahead
Looking ahead, a few key indicators will give us further insight into the economy:
- The House Price Index and New Home Sales reports will shed light on the real estate market.
- The second estimate of Q4 2024 GDP will provide more clarity on overall economic growth as we enter the second quarter of 2025.
Thought of the Week: The Gold Rush Continues
Gold has been on an incredible run, up 12% year-to-date, nearing $3,000 per troy ounce. This follows an impressive 25.3% surge last year, even outpacing the S&P 500’s total return. Naturally, investors are wondering what’s fueling the rally and how gold fits into a well-structured portfolio.
At first glance, the rally is surprising, given that overall demand has remained relatively stable over the past five years. However, one group of buyers has emerged as a dominant force: central banks. Since 2019, they have increased their purchases by 11.5% annually, largely to diversify reserves—especially after Russia’s foreign assets were frozen in 2022. Unlike private investors, central banks are price-insensitive buyers, accumulating gold as a geopolitical hedge rather than a return-driven asset.
For private investors, the calculus is different. Gold generates no yield, making it a more expensive asset to hold in today’s high-interest-rate environment. While it has historically been a strong crisis hedge, it has not been a reliable long-term growth asset. Since 1988, gold has delivered roughly half the returns of a traditional 60/40 portfolio but with 50% more volatility. Today, investors looking for diversification might find better alternatives, such as transportation and infrastructure investments, which not only reduce risk but also provide income—something gold inherently lacks.
Philosophy Quote of the Week
“Keep in mind that it isn’t the one who has it in for you and takes a swipe that harms you, but rather the harm comes from your own belief about the abuse.” – Epictetus, Enchiridion, 20
This Stoic wisdom reminds us that external events only affect us if we allow them to. Whether it’s market volatility, criticism, or unexpected challenges, our reaction is what determines their impact. If we can learn to control our responses, we gain control over how we experience the world.
Tax Tips: Property Tax Valuation
As we enter March, property owners will begin receiving their annual property tax valuation notices. These assessments—often 18 months behind current market values—determine your property tax obligation for the coming year.
If you think your valuation is incorrect, consider appealing. You may have a case if:
- The Full Cash Value (market value) appears too high.
- The county has incorrect square footage listed for your home.
- The comparable sales (“comps”) used to assess value don’t accurately reflect your neighborhood.
You have 60 days from the notice date to file an appeal, so if you think your assessment is incorrect, act quickly!
Financial Fitness Checkup: Are You Ready for 2025?
As we settle into the year, now is the time to assess your financial fitness. Have your goals changed? Are you preparing for a major purchase, college tuition, or business expansion? Here are a few areas to review:
- Cash flow planning – Are you optimizing your savings and expenses?
- Investment strategy – Does your portfolio align with current market conditions?
- Estate planning – Are your beneficiary designations and trusts up to date?
- Risk management – Could you sustain your lifestyle for six months without dipping into long-term savings?
If you’re uncertain about any of these areas, now is a great time to schedule a Financial Fitness Checkup with our team.
Closing Thoughts
That wraps up this week’s Market Recap! If you’d like to connect with Jason Duffaut, CFP®, CAP®, CPFA®, CEXP®, Kenneth Hamilton, CFP®, RICP®, CDFA®, CSSCS®, or myself, Matt Donaghue, CFP®, CLU®, CLTC®, AIF®, AIFA®, PPC®, NSSA®, RICP®, visit www.missionfinancialplanners.com or give us a call at 888-339-0093.
Thanks for reading, and I’ll see you next week for more financial insights. Stay smart, stay informed, and stay financially fit!