The Weekly Update 3/07/2025

PURE FEAR

The chart above from The American Association of Individual Investor, AAII, from 2/27/2025 paints a picture of investor fear!

We now rest at fear levels at just about the same as September 2022 which, if you recall, was at the end of a very scary eight months of down valuation for Corporate America.

The only difference this time is that it has only been eight business days from the last all time high on the S&P 500 on February 19, 2025.

A very good question to ask would be this one.  “What happened after prior readings of

-41 or below?” 

Here it is! Unbiased, source-sited facts.

Of the ten data points posted above, the pink column on the right tells you plain as day what happened next, over the next year that followed.  And that is …..

The average gain of +22%.

For me, well I don’t believe the primary cause for this, the tariff uncertainty, is going to last too long.  This will pass and the administration has already stated their focus will shift to killing red tape and reducing taxes.

If that holds, expect a rather positive summer increase in values and a positive year ahead.

I did not say market valuations go straight up, and I did not say without volatility, yet the data flow suggests the good old USA has a very bright outlook. 

I am interested in your thoughts, comments, and observations. Feel welcome to call, email, or stop by the office and say Hi.

Respectfully,

James O. Lunney, CFP®

CERTIFIED FINANCIAL PLANNER™ Professional  

Securities and advisory services offered through LPL Financial, a registered investment advisor. Member FINRA/SIPC. The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual Investing involves risks including possible loss of principal. No investment strategy or risk management technique can guarantee return or eliminate risk in all market environments.

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly. 

Investing involves risk including loss of principal. No strategy assures success or protects against loss. 

The economic forecasts set forth in this material may not develop as predicted and there can be no guarantee that strategies promoted will be successful. 

The S&P 500 Index is a capitalization-weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries