Recently, there have been many headlines about the debt ceiling negotiations in Washington. If we look at history, America has never intentionally defaulted on its obligations as the debt ceiling has been raised over 100 times in the past 123 years. Remember, the worst-case scenario for any politician is one where they are responsible for Americans not receiving their Social Security checks or any economic benefit they are legally entitled to. Whether an agreement is found before June 1st or the debt ceiling is temporarily suspended until further negotiations, we strongly expect the U.S. will continue to pay its bills and uphold the strong financial credibility of our country.
In the short term, political headlines like this may contribute to market volatility in the upcoming summer months. However, on a positive note, higher interest rates could provide a more meaningful return on CDs and bonds than we’ve seen in the last decade. Also, inflation is continuing to fall, and many companies are continuing to profit in this slowing economy which are two good signs for the long term. We believe your portfolio is well positioned for the long term with diversified, high-quality investments. Please reach out with any questions or concerns. Thank you for your business and confidence.