Comments based on information available as of 5:45am CT on 11/21/2025
Growth: Dated Data Is Better Than No Data 
Summer feels like ages ago, but we’re only now getting the backlog of government data. Most of it simply confirms what we already suspected: the economy is in a transition, and it’s uneven. August showed a drop in imports. September’s job gains were solid, but not widespread. It’s a mix of strength in some areas and softness in others. The summer looks like it was the rough patch, and the real question now is whether the Fall and Winter months firm up or stay uneven. At this point, they look more like periods of gradual recovery than the start of a recession.
Inflation: A Dose of Deflation?
Over the past year, goods have swung from falling in price to rising again, while services prices have kept climbing—but at a slower pace. That combination has kept overall inflation stuck above the Fed’s target. Recently, President Trump exempted a long list of food items from tariffs. That shift means the tariff-driven inflation in things like bananas and coffee could flip to outright price declines, even if only for a while. A small bout of deflation in items people buy often—and notice immediately—could meaningfully shape how households perceive inflation, even if the broader trend doesn’t change overnight.
Policy: The Streetlight Effect
There’s an old joke about someone searching for their lost keys under a streetlight. When asked if that’s where the keys were dropped, the person says, “No, I lost them in the alley—but the light is better here.” That came to mind listening to Fed officials this past week. Some insist on waiting for the “bright light” of official government data before cutting rates. Others are willing to rely on the dimmer, but more immediate, glow of alternative data. You can probably guess which approach I find more sensible. No data set—official or otherwise—is perfect. At some point, you have to work with the light you have, not the light you wish you had.
Looking Ahead: The Bigger They Are, The Harder They Fall
When the largest companies are driving most of the gains, it can make the market look stronger than it really is. But that concentration cuts both ways: when those same names stumble, the impact is just as outsized. When the largest companies drive most of the losses, the market can look weaker than it really is. A bit of balance can soften that blow, even if it means you won’t keep up perfectly when the biggest stocks surge. That’s the ongoing trade-off for investors—staying invested in the leaders without letting a handful of them dictate the entire ride.
