It’s March Madness time! No, not the basketball tournament, but the Federal Open Market Committee meeting starting today! We’ll take a quick look at where the inflation numbers are and how the FOMC will likely respond.

We also see how new car prices have stabilized in the last year and the adoption of electric and hybrid vehicles by U.S. consumers.

In a WSJ article called Half of College Grads Are Working Jobs That Don’t Use Their Degrees, the authors state, “Roughly half of college graduates end up in jobs where their degrees aren’t needed, and that underemployment has lasting implications for workers’ earnings and career paths. More than any other factor analyzed including race, gender and choice of university what a person studies determines their odds of getting on a college-level career track.”

So what is the real value of a college education? Why are our college graduates failing to launch a career that uses what they learned in college? Then add the impact of student loan debt. It’s a real crime to have a large debt load at graduation, and you can’t even use your degree, praying the government will bail you out.

Have you heard of Rare Earth Elements? It wouldn’t surprise me if you hadn’t. But they are a vital part of the modern industrial supply chain and are critical components in many modern necessities.

The Conference Board released its latest reading of the Consumer Confidence Index today. US consumer confidence fell in February for the first time in four months as Americans’ views deteriorated about the outlook for the economy, the job market and financial conditions. The crazy part of The Conference Board report is continued confidence by consumers that the stock market will continue its upward trend.

But first, a quick note regarding the release of last month’s Federal Open Market Committee (FOMC) minutes. Officials indicated at their last meeting that they were not in a rush to cut interest rates. No cuts would be coming until the FOMC held “greater confidence” that inflation is “moving down sustainably to 2 percent.”

While the minutes acknowledged the “solid progress” being made, the committee viewed some of that progress as “idiosyncratic” and possibly due to factors that won’t last.

Let’s take a look at the latest macroeconomic indicators and how the FOMC and the stock markets might react.

The focus today is on retirement. We either look forward to retirement or dread the day that it comes. It comes down to how much you have planned for it, saved for it and accepted that it will happen ready or not. Some hope it will all work out in the end, so they didn’t think much about it. Well hope is not a strategy. We will also talk about handing off your wealth to the next generation. 

Before we start a discussion into what seems like science fiction made real, let’s look into the past. Artificial Intelligence (AI) is a term that was coined by John McCarthy, a legendary American computer and cognitive scientist, in the 1950s. He is widely regarded as one of the "founding fathers" of AI. Alongside other luminaries like Alan Turing, Marvin Minsky, Allen Newell, and Herbert A. Simon, McCarthy played a pivotal role in shaping the field.

McCarthy, a Stanford professor and Turing Award recipient, developed the programming languages known as LISP and ALGOL. LISP was pivotal in AI development and research while ALGOL popularized the concept of time-sharing in computing, allowing multiple users to interact with a computer at the same time – a key concept for those that would expand McCarthy’s work in the decades to come.

Outside of financial reporting, articles on inflation rates usually quote the Consumer Price Index, or CPI. But financial writers in-the-know will reference “the Fed’s preferred measure of inflation,” the Personal Consumption Expenditures price index, or PCE. Today we’ll take a look at the two measures of inflation, how they are determined and why the Federal Reserve prefers one over the other.

But before we dive in, let’s take a look at some of the economic news released last week. Punxsutawney Phil, the famous weather-casting groundhog, didn’t see his shadow last Friday, and so predicted an early spring. Let’s see if the economy looks as rosy.

In money management you always reap in a different season than you sow. And by the way, not all fruit ripens at the same time. When you have a peach tree, they’re not all ripe at once. They come in little by little. Investments can take time to grow too. Instant success is rare. 

When I started in this business, everything was dominated by stocks, bonds, mutual funds, buy-and-hold strategies, and basic equity-bond diversification. In general, this worked well before this century.

A lot has changed since I started in the business. Technology has had a big impact on how markets and investors operate. The interest rate and fixed income environments have changed dramatically. We have seen an increase in risk-managed strategies that can deliver competitive returns while seeking downside protection during volatile periods or in bear markets.

I have been in the investment business for 28 years. This will mark my seventh Presidential election cycle over that period. Without fail, clients have questions and concerns about market performance during each presidential election cycle.  It is a common question and I always give the same answer – it varies but in general performance is pretty good.

Wall Street is clearly eager for interest rate cuts. Since the Federal Reserve released the minutes of their latest policy meeting earlier this month, the conversation on the street isn’t IF rates will be cut in 2024, but WHEN. Here are a few of the latest headlines I’ve seen:

Three Stocks to Buy Before the Fed Cuts Interest Rates in 2024

Investors Expect Fed to Cut Rates Soon

The Fed Will Cut Interest Rates Six Times in 2024

These headlines and plenty others reflecting the same line of thought are overly hopeful and misguided. As Fed Chair Jerome Powell likes to say, let’s take a look at the data to get a hint of what the FOMC is thinking, and why I believe interest rate cuts won’t happen until the second half of 2024.