The Armstrong Report: Fall 2023 Firm Update

Reginald A.T. Armstrong • The Armstrong Report

Welcome to October! By the time you receive this, we will either be about to have our Client Appreciation Picnic (October 13th!) or will have just had it. Hopefully, we will have seen many of you there.


While the recession is delayed, I doubt it will be avoided. The Conference Board’s Leading Economic Indicators (LEI) have been down for the past 17 months and have been indicating recession all year. Manufacturing has been contracting all year. Services and retail sales have been okay, but we will see how student loan repayments restarting affect consumption. We see credit card usage picking up, bank lending standards are quite tight, and a host of other factors seem recessionary. Keep in mind that conditions in a recession deteriorate gradually and then, in a matter of months, fall off a cliff. While we can have a recession and its accompanying bear market without a financial crisis, keep an eye out for commercial real estate. In that sector, there be dragons.


Stocks had a typical consolidation in August and September, historically the two weakest months of the year. While stocks are still expensive, until something snaps, the path of least resistance is still likely a bit higher. The advance in stocks is very narrow. The S&P 500 is up about 14% as of this writing, but if you take out the top seven stocks, it is up under 3%. Also, with cash equivalents and bond yields paying above 5%, the equity risk premium is about zero. This means the risk-reward ratio is poor. Speaking about bonds, yields have surged higher once again. This is painful in the short term. However, it is an opportunity to lock in higher yields and rebalance appropriately. If my concerns about the economy are correct, yields will likely drop some as a recession becomes evident.


I often tell people that if I have done anything well, it is in finding great people and retaining them. This year Creighton celebrates 3 years with our firm, Emily and Jason 12 years, Matt 15 years, Leslie 21 years, and Lee 23 years. Additionally, I first hired Crystal Butler, our marketing consultant, 15 years ago. She later married her high school sweetheart and decided to start her own business. We have been her client since then. When we say we are a TEAM, we mean it, and the entire team is at your service.

All of us at Armstrong Wealth appreciate your trust. We look forward to continuing to earn it every day. Enjoy the cooler weather.

Read the Full Fall 2023 Newsletter

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