Navigating Through Noise
My first job out of college was with a large IT consulting firm. Like most 22-year-olds, I was thrilled when I got my first out-of-state assignment—South Florida. It meant eight-plus hours in the air, not to mention the procession of airports and layovers that came with business travel. On one particular trip, I had a connection in Atlanta—famously the world’s busiest airport—during a thunderstorm. I was seated in the last row of a DC-10 as we took off into the storm, getting tossed around the sky like a leaf in… well… a thunderstorm. After one particularly strong jolt, the cabinet door behind me flew open, slamming back and forth. I looked back and saw a flight attendant preparing to spring into action. Luckily, I could reach it myself, so I grabbed the door and held it shut until the air smoothed out. It didn’t do much to change our situation, but oddly, it helped me feel calmer. I wasn’t in control of the flight—the pilot was. But having something to do, even something minor, helped ease the discomfort.
The same is often true in markets. During turbulence, whether in the sky or in the economy, there’s a powerful urge to act—to do something—simply for the relief that action can bring.
But as in air travel, not all actions are helpful—and some may even make things worse. When markets jolt, headlines scream, and volatility spikes, the temptation is to reach for control. Often that means making sudden shifts in portfolios or chasing perceived “safe zones.” But meaningful investing is rarely about reacting in the moment. It’s about preparing before turbulence hits and trusting the systems in place once it arrives.
This quarter has brought no shortage of unsettling currents. These factors add weight to an already complex global picture. None of them are individually unprecedented, but together they’ve amplified investor anxiety—and understandably so. Yet, in times like these, it’s especially important to distinguish between noise and signal.
Tariffs and Trade: Echoes of the Past
The return of broad tariffs has stirred memories of past trade wars and raised real questions about global supply chains. While tariffs can support domestic industries in the short term, they also introduce new inefficiencies and potential inflationary pressures. History reminds us that while these policies shift the landscape, markets—and portfolios—can adapt. For our part, we continue to monitor the secondary effects and adjust exposures where prudent—particularly in international holdings.
Rates and the Fed: The Long Wait
Interest rates remain a central story. While some anticipated rate cuts by mid-year, the Federal Reserve has opted for caution. Inflation, while cooling, hasn’t receded enough to trigger a pivot. For income-focused clients, this has meant more attractive bond yields—but it also calls for careful credit quality selection and duration control. We’re staying flexible and opportunistic, rather than betting on a particular rate path.
The AI Boom (and the Bubble Watch)
Artificial Intelligence continues to reshape not just technology companies, but the broader economy. The gains in certain AI-related equities have been striking—at times, euphoric. While innovation should be welcomed, we remain wary of narrative-driven surges that detach from fundamentals. Our approach is to participate where we see durable opportunity, but without losing sight of valuation or concentration risks.
Geopolitical Risk: A Somber Undercurrent
The human cost of rising conflict in the Middle East and Ukraine cannot be overstated. We are watching as new forms of warfare are being created and employed. From a market perspective, these developments increase volatility, particularly in energy markets and global risk appetite. Diversification remains our best defense against the unknowable, although it is no panacea against losses.
Domestic Politics: Headline Heat, Measured Impact
The political impasse in Washington around President Trump’s bill has dominated recent coverage. While it may have long-term implications depending on the outcome, we remind clients that political theater often has less bearing on investment outcomes than it seems in the moment. Staying focused on fundamentals keeps us from being swept up in short-term noise.
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Final Thoughts
Turbulence, whether in the skies or in the markets, is uncomfortable. It tempts us to take action just for the sake of feeling in control. But more often than not, the wisest move is to focus on what matters most: staying grounded in purpose, trusting a sound process, and knowing who’s at the controls.
We’re grateful, as always, for your continued trust. If you’d like to revisit your goals, review your risk profile, or simply talk through what’s happening in the world right now, we’d be honored to have that conversation. Don’t hesitate to reach out to me or anyone on our team.
Kevin P. Sullivan, CFA, CFP®, AIF
1229 Lake Plaza Drive
STE B
Colorado Springs, CO 80906
719.576.4500
Sullivan & Associates is not a registered broker/dealer and is independent of Raymond James Financial Services. Investment advisory services are offered through Raymond James Financial Services Advisors, Inc., and Sullivan & Associates. Securities are offered through Raymond James Financial Services, Inc., member FINRA/SIPC.
The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. The information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing material is accurate or complete and it does not constitute a recommendation. Any opinions are those of Kevin Sullivan and not necessarily those of Raymond James. Expressions of opinion are as of this date and are subject to change without notice. Past performance is not a guarantee of future results. Future investment performance cannot be guaranteed, investment yields will fluctuate with market conditions. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct. Investing involves risk and you may incur a profit or loss regardless of the strategy selected. Gold is subject to the special risks associated with investing in precious metals, including but not limited to: price may be subject to wide fluctuation; the market is relatively limited; the sources are concentrated in countries that have the potential for instability; and the market is unregulated. Investing in oil involves special risks, including the potential adverse effects of state and federal regulation and may not be suitable for all investors. There is an inverse relationship between interest rate movements and bond prices. Generally, when interest rates rise, bond prices fall and when interest rates fall, bond prices generally rise. International investing involves special risks, including currency fluctuations, differing financial accounting standards, and possible political and economic volatility. The companies engaged in the communications and technology industries are subject to fierce competition and their products and services may be subject to rapid obsolescence.
Every investor's situation is unique, and you should consider your investment goals, risk tolerance, and time horizon before making any investment. Prior to making an investment decision, please consult with your financial advisor about your individual situation. Certified Financial Planner Board of Standards Center for Financial Planning, Inc. owns and licenses the certification marks CFP®, CERTIFIED FINANCIAL PLANNER®, and CFP® (with plaque design) in the United States to Certified Financial Planner Board of Standards, Inc., which authorizes individuals who successfully complete the organization's initial and ongoing certification requirements to use the certification marks.
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