Our national debt has soared to a record $35.7 trillion. It isn’t rocket science to understand how this happens. National debt continues to rise because the government spends more money than it received in revenues. It then borrows from lenders to bridge the budget gap.

In the Halloween spirit and with that enormous debt number in mind, I thought about rewriting a few scary classics to keep with the times.

Investors have experienced uncertain and sometimes volatile market conditions over the last several years. Because of this, many advisors are introducing their clients to alternative investments with the goal of portfolio diversification with reduced volatility. Today we define alternative investment and give some common examples. Over the next several weeks, we will delve more deeply into the world of alternative investments and why “alts” have become more utilized in the investment community.

The cost of property damage due to extreme weather is front and center in the news. Damage estimates due to Hurricane Helene range as high as $48 billion. Fitch Ratings, one of the “Big Three” corporate credit rating agencies, estimates Hurricane Milton could reach $50 billion in insured losses for Florida property owners. Florida state officials say if Milton had reached Category 4, the losses would have easily doubled.

Even before these calamities struck, homeowners had seen insurance costs increase. And it seems like natural disasters take a bigger toll each year. What can be done to curb the meteoric rise in premiums? Today we’ll take a look at the problem, the underlying causes and what can be done to help.

Creative destruction is an economic concept developed by economist Joseph Schumpeter in the 1930s and 40s. Schumpeter’s creative destruction is a concept that describes the process of innovation-driven change in an economy, where new products, processes and industries emerge, replacing and making existing ones obsolete. This perpetual cycle of innovation and obsolescence is a fundamental characteristic of capitalism. According to Schumpeter, “The process of industrial mutation that incessantly revolutionizes the economic structure from within, incessantly destroying the old one, incessantly creating a new one.”

The biggest economic news of late has to be the Federal Reserve’s interest rate cut on September 18. The Federal Open Market Committee (FOMC) boldly decreased its target interest rate range by 0.5 percent to 4.75% - 5%. This is the first rate cut since the early days of the Covid pandemic in 2020.

In their post-meeting statement, the FOMC wrote, “The Committee has gained greater confidence that inflation is moving sustainably toward 2 percent, and judges that the risks to achieving its employment and inflation goals are roughly in balance.”

But important to note was the final vote on the rate cut was 11-1, with Federal Reserve Governor Michelle Bowman supporting a 25-basis point move. Bowman’s dissent was the first by a Fed governor since 2005.

Today we will examine the reasoning behind Governor Bowman’s firm stance and some reasons why the Fed needs to think again regarding further “jumbo rate cuts.”