Wealthstone 2025 Mid-Year Market Outlook
Navigating the Mid-Year Crosscurrents: A Look Ahead for Investors
The first half of 2025 was a testament to the market's resilience. What began as a predicted storm of volatility evolved into a Category 5 hurricane, yet we have emerged with the markets once again approaching their all-time highs. The hyperinflationary spiral some feared never materialized, and the turbulence has largely passed. So, where do we stand now, and what does the second half of the year hold?
A Mid-Year Snapshot
The market is sending a bifurcated message. While large-cap U.S. technology stocks have led the way, other sectors have lagged, underscoring a flight to quality. In this environment, our strategic focus on market leaders, complemented by alternative investments in private credit and real estate, has proven its value. On the economic front, core inflation has encouragingly fallen from 3.3% to 2.8%, even amidst the implementation of new trade tariffs. This suggests that businesses, for now, are absorbing costs rather than passing them on to consumers, which has helped keep a lid on inflation and unemployment.
Geopolitical Risks and Policy Horizons
Geopolitical tensions, particularly the escalating war in Ukraine and the delicate situation with Iran, remain the most significant wildcards. A resolution in Ukraine would be a deflationary tailwind for the global economy, while a conflict with Iran could trigger a recession-inducing oil shock. Our base case is for diplomacy to prevail, but we remain vigilant.
Domestically, we anticipate the Federal Reserve will begin to cut interest rates in the latter half of the year to support economic growth. On the fiscal front, Congress is debating critical tax legislation to prevent the 2017 tax cuts from expiring, a move that would be vital for avoiding a major fiscal headwind.
Our Outlook: Cautious Optimism
We believe the second half of 2025 will mark a durable recovery for U.S. markets, led by a renewed focus on the transformative power of artificial intelligence and other revolutionary technologies. For investors holding cash, the current environment presents a compelling entry point. Catalysts for further appreciation are clear: Fed rate cuts, supportive tax policy, and any de-escalation of global conflicts. We remain confident in our positioning and believe investors should not only stay the course but look to take advantage of the recovery now underway.
For a more detailed analysis, please see our full 2025 Mid-Year Market Outlook.
Decoding the “One Big Beautiful Bill Act”: What Investors, Advisors, and Families Need to Know
Discover how the “One Big Beautiful Bill Act”—the most consequential tax and spending legislation since the 2017 Tax Cuts and Jobs Act—could transform the financial landscape for individuals, business owners, and families. In this in-depth analysis, Wealthstone Private Wealth Management breaks down the bill’s major provisions, including permanent lower tax rates, expanded estate and business tax benefits, new rules for retirement and healthcare planning, Opportunity Zone updates, and the repeal of key green energy incentives. Designed for clients and financial professionals, this article offers clear explanations of the bill’s implications, strategies for adapting your tax and estate plan, and what high-net-worth families and their advisors need to know as the legislation advances through Congress. Stay informed and prepared for the changes that may shape your financial future.
Why The DeepSeek AI Crash Was a Good Thing & Here’s Why Most Experts Are Wrong About AI — Zak Gardezy, CFP® Explains
The recent DeepSeek AI crash sent shockwaves through the tech and investment world, raising questions about the future of AI hardware demand. But is this really a bad thing? In this article, Zak Gardezy, CFP® and founder of Wealthstone Private Wealth, breaks down why this market shake-up may actually be a long-term positive for AI innovation, investing, and the broader economy.
Read more to see why most experts are getting this wrong.
The Storm Before the Calm – Wealthstone Monthly Market Commentary | March 2025
The markets have experienced a turbulent start to 2025, with the S&P 500 officially entering correction territory before rebounding slightly in mid-March. As investors navigate heightened volatility, key concerns include trade tensions, geopolitical instability, Federal Reserve policy, and uncertainty in the AI sector. In this month's market commentary, I break down the drivers behind the correction, what investors should expect in the months ahead, and how we at Wealthstone are positioning portfolios to withstand short-term volatility while capitalizing on long-term opportunities.
Read the full article or contact me at zak@wealthstonepwm.com to discuss how these market dynamics may impact your investment strategy.
What Is Your Financial Advisor Costing You?
In this article, I aim to demystify the costs associated with hiring a financial advisor, providing transparency and sharing tips to help you make informed decisions when selecting a professional for your portfolio management and financial planning needs.
4 Tax Tips For Growing Your Wealth by Zak Gardezy CFP®
Zak Gardezy, CFP®, shares expert advice on maximizing your financial growth through smart tax strategies. Zak Gardezy covers essential tips to help you reduce your tax burden, optimize your investments, and ensure your wealth continues to grow. Don't miss these valuable insights from Zak Gardezy to enhance your financial planning and secure your financial future.
Story Time: Estate Planning Crisis…Avoided
Estate planning is often seen as something that can be put off until later, but delaying it can lead to significant complications. Take Mary, for example, a woman in her late 70s who managed her own investments and lived alone. When cognitive decline unexpectedly set in, it became clear how critical it was to have a plan in place. Without an estate plan, her assets and wishes were at risk of falling into disarray. Fortunately, through timely intervention and the creation of a comprehensive estate plan, Mary’s assets were protected, and her family was spared the potential chaos and costs that can arise from lack of preparation. This real-life example underscores the importance of taking proactive steps in estate planning to ensure peace of mind and financial security for the future.
Myth Busted: "Divided Governments Are Best For Markets" by Zak Gardezy, CFP®
Over the years, many analysts have asserted that “a divided government is best for markets,” believing legislative gridlock reduces uncertainty and moderates policies. However, historical data tells a different story. Analyzing S&P 500 returns from 1926 to 2023, we find that unified governments have historically provided stronger market returns, with an average annual return of 14.15% compared to 10.18% under divided governments. As the 2024 elections approach, it’s crucial for investors to consider their specific financial goals and stages of life rather than relying solely on political outcomes. Zak Gardezy finds that unified governments, contrary to popular belief, have often resulted in more robust market performance.
Artificial Intelligence: Catalyst Behind The Fourth Industrial Revolution by Zak Gardezy, CFP®
Zak Gardezy, CFP® - a seasoned wealth manager and financial planner, delves into the transformative journey of the four industrial revolutions. The piece begins by outlining the profound shifts from steam and rail in the first revolution, to electrification in the second, the advent of computing in the third, and culminates in today's digital revolution powered by artificial intelligence.
Zak skillfully interweaves historical context with actionable investment thoughts, emphasizing how each revolution brought about pivotal changes in the US and global economies. The focus then shifts to the current era of AI, where Zak discusses its disruptive impact across various industries and society.