It is admittedly a bit odd for a financial planner to begin a newsletter by quoting the father of communism, particularly one who may not have even said it, but the line captures the past quarter perfectly: "There are decades where nothing happens, and there are weeks where decades happen."

Between renewed conflict in the Middle East, tariff disputes, fiscal policy changes, inflation concerns, the appointment of a new Federal Reserve Chair, and continued advances in artificial intelligence, the news cycle rarely paused long enough for us to catch our breath. Yet despite the constant barrage of headlines, markets once again demonstrated an important lesson: the economy is not the news, and the market is not the economy.

On the geopolitical front, the conflict involving Iran and the temporary closure of the Strait of Hormuz caused significant concern in global markets and pushed oil prices higher. Fortunately, at least for the time being, tensions have eased somewhat as hostilities appear to be paused under a fragile ceasefire.

Energy prices remain an important variable for investors. Because oil is traded in a global market, sustained price increases eventually ripple through the broader economy. If energy prices remain elevated for an extended period, inflationary pressures are likely to build, making it more difficult for the Federal Reserve and other central banks to lower interest rates. For now, however, energy markets have stabilized, and investors remain hopeful that the ceasefire will hold.

Meanwhile, the war between Ukraine and Russia continues to evolve. Ukraine has demonstrated an increasing ability to strike military and infrastructure targets deep within Russian territory, highlighting how modern warfare is becoming less defined by traditional front lines. While the ultimate outcome remains highly uncertain, the conflict continues to serve as a reminder that geopolitical risks remain an important consideration for investors. Once again, investors were reminded that while markets react to events, they also quickly begin pricing what comes next.

Here in the United States, we continue to watch the political chess match, or perhaps more appropriately, political boxing match, as both parties seek to gain an advantage ahead of the November midterm elections. As Election Day draws closer, we should expect campaign rhetoric to become more intense and political volatility to increase. While elections often dominate the headlines, it is important to remember that markets have successfully navigated periods of political uncertainty under both Republican and Democratic administrations. Political headlines are often loud. Markets are usually more interested in earnings, innovation, and economic fundamentals than campaign slogans.

I have also received a number of questions regarding the appointment of the new Federal Reserve Chair, Kevin Warsh. Based on what I have researched, he appears to be a thoughtful and well-qualified choice. That said, judging the success of any Federal Reserve Chair requires patience. Monetary policy works with long and variable lags, and it often takes years before the full impact of policy decisions becomes clear.

Finally, we come to artificial intelligence and its growing impact on all of our lives, often in ways few of us anticipated. There is little doubt in my mind that AI is here to stay, and we will continue to see it reshape industries, improve productivity, and, unfortunately, disrupt some communities and occupations along the way.

In the near term, however, the enormous investment being made in AI infrastructure is serving as a meaningful economic catalyst. Companies continue to spend heavily on data centers, semiconductors, power generation, networking equipment, and software, providing support for economic growth even as other areas of the economy have slowed.

The current environment increasingly reminds me of the dot-com era, although on a much more compressed timeline. The internet ultimately transformed nearly every aspect of our lives. It gave us remarkable innovations and opportunities, along with a few developments many of us could probably live without. Personally, I am looking at social media and its effects on children. Like the internet before it, AI will almost certainly produce both extraordinary benefits and unintended consequences.

For investors, however, artificial intelligence remains one of the defining long-term investment themes. While there will undoubtedly be winners, losers, and periods of excessive enthusiasm along the way, I continue to believe that AI will shape the global economy for decades to come. The difficult part is not determining whether AI matters. It almost certainly does. The difficult part, as always, is distinguishing between revolutionary technology and reasonable investment expectations. Revolutionary technologies change economies, but even revolutionary businesses can become overpriced. As investors, our challenge is to recognize both the promise of innovation and the importance of valuation.

As I write this, we have just celebrated the 250th anniversary of our American Republic. Our firm was founded just four years after our nation's Bicentennial, and we have now had the privilege of serving clients for nearly half a century. We are truly blessed, not only to have been in business for so many years, but also to have clients who have placed their trust in us for much of that journey. For that, I offer my sincere thanks.

As always, if you have any questions or concerns, please don't hesitate to reach out. Times of uncertainty are when disciplined planning matters most.

I'll close with a slight modification of a lyric from one of America's great philosophers, or at least one of its great bands, Smash Mouth. They sang, "The years start coming and they don't stop coming." I think the modern version is even more fitting:

"The changes start coming, and they don't stop coming."

The world will continue to change. Markets will rise and fall. New technologies will emerge, old assumptions will be challenged, and headlines will continue to demand our attention. Through it all, it is worth remembering where we began: the economy is not the news, and the market is not the economy. Our commitment remains unchanged, helping you navigate whatever comes next with discipline, perspective, and confidence.

Kevin P. Sullivan, CFA, CFP®, AIF

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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.

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