Federal Reserve Chair Kevin Warsh used his Jackson Hole speech last week to say inflation is still too high. He also said current rates may not be restrictive enough. Markets now see a real chance of a September hike.

But higher rates can’t fix what’s actually driving inflation up.

Let’s look at the sources. Import tariffs are raising the cost of goods. Immigration enforcement is pulling workers out of farms and construction sites. Energy shocks are pushing up fertilizer and transportation costs.

This is a supply problem, not a demand problem.

None of this is about people spending too much money. It’s about the physical cost of producing things going up.

A rate hike works by making borrowing more expensive. Mortgages cost more. Business loans cost more. Credit card debt costs more. People and companies respond by spending less. That drop in spending is how the Fed cools inflation.

But that tool only works on inflation caused by too much demand chasing too little supply. It does nothing to build a house faster, staff a farm, or produce fertilizer.

Using rate hikes to fight supply-driven inflation doesn’t fix the cause. It just shrinks the economy until reduced demand matches the reduced supply. That’s a slower, more painful path to lower prices, and it raises the odds of an unnecessary recession. A rate hike is simply the wrong tool.

The real fix would be trade relief, expanded work visas for agriculture and construction, and investment in domestic energy and fertilizer capacity.

Rolling back tariffs on industrial inputs and raw materials would lower production costs right away. Expanding visa programs for farm labor and construction jobs would ease the worker shortage without touching broader immigration policy. Investing in domestic energy capacity, refining, and fertilizer production would insulate core goods prices from overseas shocks.

I don’t expect much of this to happen soon given where things stand politically. Rolling back tariffs and expanding immigration quotas both run into the current political environment, and neither side of that fight looks close to backing down.

It’s more likely that the administration holds its trade and immigration positions while making small, piecemeal fixes around the edges. The Fed keeps rates high to prevent these costs from becoming permanently baked into how people expect prices to behave.

The result is a slow grind rather than a sharp shock. Prices should moderate some as the initial tariff adjustment works through the system, but the underlying cost structure doesn’t go away. Growth slows, hiring cools, and the economy sits in that uncomfortable space between inflation and recession for longer than anyone would like.

That backdrop is a big reason we favor companies with strong free cash flow and real commodities exposure in our portfolios right now.

Free cash flow matters because a business that funds itself from its own operations doesn’t need cheap credit to keep growing. When borrowing costs stay high, that kind of company can keep investing and paying shareholders while more indebted competitors pull back.

Commodities exposure works from the other direction. When the price of oil, grain, or metals rises, a company that produces or holds those commodities usually sees its revenue rise with it, which offsets the same cost pressure that’s squeezing everyone else.

On the fixed income side, the same logic points toward short term bonds and floating rate debt instead of longer duration bonds. Short term bonds reset faster if rates move, so they carry less risk if the Fed starts to raise interest rates. When long-term rates go up, long-term bonds go down in value to adjust for the yield which has been locked in. Floating rate debt pays interest that adjusts with the Federal Funds rate and avoids this problem.

Together, these are three ways to hold up in an economy where input costs stay elevated and credit stays expensive, and neither one depends on guessing when the Fed moves next.

If you’d like to discuss your portfolio, feel free to reach out.

’till next time, keep calm and invest.

Nirav

Yesterday (August 19, 2026), the U.S. Treasury announced it will double the size of its bond buyback program, from $2 billion to at least $4 billion per operation. The purchases start September 9 and run through early November. The goal is simple: push long-term bond yields back down.

It worked right away. The 30-year Treasury yield, which had hit 5.34% the day before, its highest level since 2007, dropped to around 5.18% within hours of the announcement. The dollar fell too, ouching its lowest level since late May.

The headline sounds like good news: lower yields, calmer markets. The reason the Treasury had to intervene tells a more useful story than the headline does.

Yields don’t spike to 19-year highs for no reason.

Investors have been demanding more compensation to hold long-term U.S. debt, spooked by total public debt which is closing in on $40 trillion with no signs of slowing down, and an government with no plan or resolve to reduce it. The pool of buyers willing to absorb that debt at current yields has been shrinking, causing long term rates to start rising.

Treasury Secretary Scott Bessent’s answer was to step into the market directly and buy bonds back, which pushes prices up and yields down. It’s the second time this month he’s intervened in a market that wasn’t moving the way the administration wanted. He also joined Japan in a currency intervention on August 1 to slow the Yen’s slide. That move was to prevent Japan from being forced to sell Treasuries in order to support the Yen, an action that would have also caused US long-term rates to rise.

This creates a real problem for the Federal Reserve.

Fed Chair Kevin Warsh has said he wants interest rates set by the open market, not managed downward by government purchases. If the Treasury is capping long-term yields at the same time the Fed is trying to keep financial conditions tight enough to bring inflation back to target, the two policies are pulling in opposite directions. Lower yields make borrowing easier and financial conditions looser, the opposite of what you want if inflation is still a concern.

There’s also a structural piece here.

To fund these buybacks, the Treasury has to issue more short-term debt. That shifts more of the government’s borrowing into bills that need to be refinanced constantly, rather than locked in for 20 or 30 years. It’s a way of managing the current problem by pushing more of the risk into the near future.

The bond market isn’t broken today. But the government is now an active participant trying to hold yields down, rather than a neutral issuer that lets the market set the price of its own debt. That’s a different environment than the one most portfolios were built for over the last fifteen years.

This is a good moment to check three things in your plan, not because of this single announcement, but because of what it signals.

Check your bond duration. If long-term yields are being managed lower by policy rather than by market forces, you’re not necessarily getting paid a fair rate for the risk of holding long-duration debt. Shorter-duration and floating-rate exposure gives you more flexibility if this dynamic continues.

Check your inflation protection. A weaker dollar and a government leaning on markets to keep borrowing costs down are both consistent with a higher structural inflation environment, not a return to the 2010s. Real assets, including commodities, infrastructure, and inflation-linked bonds, earn their place in a portfolio precisely for periods like this.

Check your assumptions, not just your allocations. The bigger question isn’t whether this specific buyback program moves markets. It’s whether your plan assumes calm, low-inflation conditions that may not hold going forward. If it does, that assumption is worth revisiting, even if nothing in your portfolio changes today.

If you’d like a second set of eyes on any of this, reach out and we can walk through your portfolio together.

Keep calm and invest,
Nirav

A client called me a few days back with what felt like a simple problem. She’d bought a new house, hadn’t sold the old one yet, and needed about three or four months of cash to bridge the gap. Her first instinct was to sell some stock. Her second instinct, thankfully, was to call me first.

I get this question more than people realize. Someone has a portfolio that’s working, and a cash need shows up that has nothing to do with the portfolio. A renovation. A tax bill. A bridge loan. The default move is almost always the same: sell something, pay the capital gains tax, move on.

There’s a better answer in a lot of these cases, and it’s one most people have never heard of.

The Institutional Trick Hiding in Plain Sight

It’s called a box spread, and it’s been around for decades, just not for regular investors. A box spread is built from a combination of options contracts, specifically a pair of calls and a pair of puts on the same underlying index, structured so the payoff is fixed and predictable no matter what the market does. Put together correctly, the structure behaves like a zero-coupon loan. You get cash today. You owe a fixed amount later.

Because that rate comes from the options market rather than a bank’s rate sheet, it often prices close to what the government pays to borrow over the same period. That’s a different universe from a margin loan or a securities-backed line of credit, where rates are commonly running anywhere from 5.75% to 10.75%.

Institutions and sophisticated traders have used this structure for years. What’s changed recently is access. Fintech platforms now handle the operational complexity, so an advisor doesn’t need to build the options trade by hand to offer it to a client.

Why the Tax Treatment Changes the Math

Here’s the part that actually surprised me when I first dug into this. The IRS doesn’t treat the cost of a box spread as interest at all. Because the structure runs through options contracts subject to Section 1256 of the tax code, the cost is generally treated as a capital loss, split 60% long-term and 40% short-term.

Compare that to a margin loan or a HELOC. Margin loan interest is almost never deductible unless it’s tied to producing taxable investment income. HELOC interest only qualifies for a deduction if the funds go toward home improvements. Use either one for a bridge loan or a tax payment, and you get no tax benefit at all.

A box spread doesn’t care what you use the money for. The capital loss treatment applies either way. For someone with other capital gains to offset, that’s a real difference, not just a footnote.

Where It Actually Fits, and Where It Doesn’t

I want to be clear about something. This isn’t a replacement for a mortgage, and it’s not a tool for everyone. You need a taxable brokerage account large enough to serve as collateral, typically borrowing somewhere around half the account’s value or less to leave room for market swings. And like any loan against a portfolio, a sharp enough drop in the market can trigger a margin call, forcing you to add cash or close the position early.

Where it earns its place is in the gap that margin loans and SBLOCs already occupy: shorter-term needs where selling investments would trigger taxes you’d rather avoid. A bridge loan. A renovation. A one-time expense you don’t want to fund by disrupting a portfolio that’s doing its job.

When a client brings me one of these situations, the first question isn’t “should you sell or should you borrow.” It’s “what’s the lowest-cost way to get the cash without derailing the plan.” Increasingly, a box spread belongs in that conversation, alongside margin loans, HELOCs, and just selling outright.

My client ended up taking a short-term box spread loan at 4.75%. Her home sold quickly, and she was able to quickly repay the loan with minimal financial cost.

If a cash need comes up and selling investments feels like the wrong move, let’s talk through what’s actually available before you default to the obvious choice. You can grab time on my calendar here:

As always, keep calm and invest.

Nirav

Risk Disclosures: This general information is not to be considered investment advice. Past performance is no guarantee of future results.

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A client called me last month frustrated about mortgage rates. He’s trying to help his daughter buy her first house, and he couldn’t square the math. “The Fed has been cutting,” he said. “Why is she still looking at 7 percent?”

I told him the uncomfortable truth: she’s been outbid. Not by another homebuyer. By the federal government.

Eighteen Trillion Dollars Has to Come From Somewhere

This year, governments across the developed world will borrow roughly $18 trillion. That’s a record. The US alone is running a $1.9 trillion deficit, and the Congressional Budget Office projects it grows to $3.1 trillion within a decade. Net interest costs more than double over that stretch, from $970 billion a year to $2.1 trillion.

Here’s why that matters to a first-time homebuyer in Pasadena. All of that borrowing competes for the same pool of global savings that funds everything else. When the Treasury has to pay 4.5 to 5 percent to attract lenders, every other borrower in the economy prices above it. Mortgages, car loans, small business credit. The government goes to the front of the line, and the line behind it gets more expensive.

Economists call this crowding out. My client’s daughter calls it the reason she’s still renting.

The People Who Used to Buy This Debt Are Gone

For two decades, this math didn’t bite, because the biggest buyers of Treasuries didn’t care about price. Foreign central banks bought them to manage their currencies. The Fed bought them by the trillion as policy. During the financial crisis, foreign owners held over half the Treasury market.

Today that share is down to about 30 percent. The Fed has stepped back. The buyers who replaced them are hedge funds, money market funds, and banks. They buy bonds for one reason: to get paid.

That’s why the 10-year Treasury sits near 4.6% even with the Fed late in its cutting cycle. The Fed controls the short end. The market controls the long end, and the market is charging for fiscal risk. I don’t think the 2 to 3 percent world of the 2010s comes back. Something like 4 to 5.5 percent feels like the new neighborhood, with the occasional tantrum when investors question whether the borrowing ever slows. Ask the UK how that felt in 2022.

How This Story Has Ended Before

Now the part nobody puts in a headline. Debt this large almost never ends in default, at least not for a country that borrows in its own currency. It ends the way it ended last time.

The US exited World War II with debt over 100% of GDP. No default. No dramatic austerity. Instead, for roughly 35 years, the government held interest rates below inflation and let the debt shrink in real terms. Bondholders and savers paid the bill slowly, through eroded purchasing power. Economists call it financial repression. If you’ve ever heard your parents complain that their savings never kept up with prices in the 1970s, they lived it.

The IMF says global public debt will pass 100% of world GDP by 2029, breaking that postwar record. When interest costs eat 4 to 5 percent of GDP, the political pressure to keep rates low gets enormous, even when inflation says otherwise. That’s how you get a world where inflation trends near 3% instead of 2% and no one ever holds a press conference about it.

What We’re Doing With This

Not panicking, for starters. There’s a genuinely benign side here. A softer dollar lifts the value of international holdings and helps US companies that sell abroad. Stocks have historically done fine in nominal terms through these regimes.

But a regime shift this large touches every line of a portfolio, so let me walk through how we’re thinking about each one.

Bonds: get paid now, not in 2046. The core problem with long-term bonds in this environment is simple. You’re lending money for 20 or 30 years to the single largest borrower in history, at the exact moment its borrowing is accelerating, and the extra yield you receive for that risk is still below its historical average. Meanwhile, the front end of the curve pays you a competitive rate with almost no interest rate risk, because the Fed anchors it. So we’ve been keeping fixed income duration short. You collect real yield today and keep your powder dry. If long rates spike in one of those fiscal tantrums, short-duration investors get to reinvest at better prices. Long-duration investors get a statement they don’t want to open. And remember the lesson of 1945 to 1980: in a financial repression regime, the long bondholder is the one who quietly pays the government’s bill.

Real assets: own what inflation can’t dilute. If the endgame is inflation running nearer 3% than 2%, you want assets whose value is denominated in stuff, not promises. Commodities, gold, real estate, infrastructure. Gold deserves a specific mention because central banks themselves are telling you something: as the dollar’s share of global reserves has slipped to around 58%, they’ve been net buyers of gold. The institutions that manage sovereign money are hedging the very regime I’m describing. We think individual portfolios deserve a similar inflation anchor, sized sensibly, as ballast rather than a bet.

International equities: a hedge hiding in plain sight. Most American portfolios are heavily home-biased, which worked beautifully for fifteen years of dollar strength. But the dollar fell over 9% in 2025 and touched a four-year low this year. When the dollar weakens, foreign holdings get a tailwind twice: once from the assets themselves, and again from the currency translation back into dollars. A meaningful international sleeve isn’t a bet against America. It’s an acknowledgment that your liabilities are in dollars and it’s reasonable to have some assets that benefit when the dollar softens.

US equities: pricing power over promises. Stocks broadly can do fine in nominal terms through a fiscal-inflation regime, but not all stocks equally. The businesses that thrive are the ones that can pass rising costs to customers without losing them. Think of companies people pay regardless of the rate environment. The businesses that struggle are the long-duration stories, the ones whose profits live far in the future and need cheap money to justify today’s price. Higher discount rates are gravity for those names. We’d rather own cash flows we can see than projections we have to believe.

Cash: useful again, but not a plan. At today’s short-term rates, cash finally pays you to wait, and that’s genuinely valuable for near-term goals and dry powder. But don’t confuse it with safety in this regime. Cash is the asset financial repression is specifically designed to tax. If inflation runs at 3% and your savings yield drifts below that, you’re losing purchasing power on schedule. Cash is a tool here, not a destination.

What would change our minds. No framework deserves blind loyalty, so here’s what we watch. If deficits actually shrink through real fiscal reform, the term premium story fades. If foreign demand for Treasuries genuinely collapses rather than just softening, the adjustment gets faster and uglier, and you’d see it in a sharply steepening yield curve. Either signal would have us rethinking. Neither is flashing today.

Our job isn’t to predict which version of the future shows up. It’s to build plans that survive several of them.

The Bottom Line

The debt story isn’t a countdown to a crash. It’s a slow tide change: higher long rates, a softer dollar, warmer inflation. Portfolios built for the old tide will feel it gradually, then suddenly. The fix is unglamorous: revisit your assumptions before the regime does it for you.

If you’d like to walk through your own plan against this backdrop, you can grab 30 minutes on my calendar.

As always, keep calm and invest.

Nirav

Risk Disclosures: This general information is not to be considered investment advice. Past performance is no guarantee of future results.

I had a conversation with a client yesterday. She’d seen the May jobs report. 172,000 jobs added. Unemployment at 4.3 percent. She felt confused. The economy seemed fine. But it didn’t match her experience of losing her job twice in the past 8 months and the difficulty in finding employment for the first time in 10 years.

I told her the headline was real. But I also said there’s a version of the labor market underneath that number that tells a quieter, more uncomfortable story.

There Are Six Ways to Measure Unemployment. We Only Talk About One.

The Bureau of Labor Statistics publishes six different measures of labor market health every single month. The one you see on the news, currently 4.3 percent, is the narrowest possible version. It counts only people who are actively job hunting. That’s it.

The other five measures paint a broader picture. They include workers who’ve stopped searching but still want a job. Workers who gave up because they believe no one would hire them. Workers who needed 40 hours a week, but could only find 20. When you roll all of that together, the broadest measure — the U-6 — is sitting at 8.1 percent right now. Nearly double the headline.

That’s not a conspiracy. It’s published on the same government website as the 4.3 percent number. Most people just don’t know to look. Most depending your news source, it may not even get reported.

This Has Happened Before

I think back to 2010 and 2011 a lot when I look at the current data. The recession was officially over. The Dow was recovering. Monthly job numbers were improving. But the U-6 stayed elevated for years. Workers were stuck in part-time jobs they didn’t choose. Long-term unemployment (counted as being out of work for six months or more) remained high long after the headline rate had dropped.

The headline and the lived experience were on different tracks. Sound familiar?

What’s striking to me about the current moment is the speed of deterioration on the long-term side. Workers unemployed for 27 weeks or more are currently running 44 percent above pre-pandemic levels.

That’s not a pandemic hangover — it started rising in mid-2025, after being nearly back to baseline in 2024. And inflation-adjusted wages have fallen over the past year, so even the workers who kept their jobs are taking home less in real terms.

What We’re Watching and Why It Matters for Your Portfolio

I want to be clear: one jobs report doesn’t change a financial plan.

But the labor market is a leading indicator for things that do affect your portfolio. Consumer spending. Corporate revenue. Credit conditions. Interest rate expectations. A consumer economy where more workers are underemployed, wages are eroding, and long-term unemployment is rising is a different environment than one where everything is as rosy as the headline suggests.

We’re not making dramatic moves based on this. We are factoring it into how we think about cash reserves, fixed income positioning, and the overall resilience of plans built around assumptions from a stronger economy.

If your financial plan hasn’t been stress-tested for a softer consumer environment, now is a reasonable time to do that.

The data isn’t alarming. But it deserves more than a headline. If you want to talk through what this means for your specific situation, I’m always happy to connect.

Schedule a 30-minute call here.

As always, keep calm and invest.

Nirav

Risk Disclosures: This general information is not to be considered investment advice. Past performance is no guarantee of future results.

SpaceX. OpenAI. Anthropic.

If you follow financial news at all, you’ve probably seen these names everywhere lately. And for good reason. SpaceX is expected to go public at a valuation somewhere between $1.75 and $2 trillion. OpenAI and Anthropic are each expected to be valued near $1 trillion or more.

To put that in perspective, the current record for the largest IPO ever is Saudi Aramco at $1.7 trillion in 2019. SpaceX could shatter that on day one.

Everyone wants a piece of this. I get it. These are genuinely important companies building genuinely important things.

But wanting a piece of something and it being a good investment are two very different things.

The History of “Can’t Miss” IPOs

Let’s go back to May 2012. Facebook goes public. Everyone knows the product. Billions of people use it. The buzz is enormous.

Four months later, the stock is down more than 50%.

It took over a year just to trade back at its IPO price.

Uber. Same story. Down roughly a third in the first five months. More than a year before it held consistently above its offering price.

These weren’t obscure companies. They weren’t bad businesses. The problem was simple: the excitement drove the price to a level that left no room for disappointment.

And these aren’t cherry-picked outliers.

Research covering every U.S. IPO from 1980 to 2024 shows that the average newly-listed company trailed comparable public companies by roughly 2% annualized over the five years following its debut. That’s not a rounding error. Over a decade, 2% per year compounded is a massive gap.

Why Does This Keep Happening?

Two main reasons.

First, profitability. Many companies go public before they’re consistently earning money. OpenAI and Anthropic are currently unprofitable by most public estimates. A company burning cash at scale, priced at a trillion dollars, is asking you to pay today for profits that may be ten years away.

Second, index pressure. S&P is reportedly looking at changing its rules to let mega-cap IPOs into the S&P 500 faster than the current 12-month waiting period. If that happens, every index fund in the world becomes a forced buyer the moment these stocks get added. Forced buyers don’t negotiate on price. They buy whatever the market is charging that day, and that cost gets absorbed by everyday investors in those funds.

What We’re Doing

We’re watching this closely, but we’re not jumping the line.

Our job is to evaluate every investment through the same lens regardless of how exciting the story is: What are we paying? What are we getting? How does the profitability compare to other opportunities at this price?

If and when SpaceX or OpenAI hits public markets, we’ll run the same analysis we’d run on any other company. If the numbers make sense, we’ll consider it. If the market is pricing in perfection at a trillion-dollar valuation with no earnings, we’ll pass and watch from the sidelines.

The companies might be incredible. The investments might not be.

There is a difference, and that difference is your money.

If you want to talk through how any of this affects your portfolio or financial plan, grab some time on my calendar.

As always, keep calm and invest.

Nirav

Risk Disclosures: This general information is not to be considered investment advice. Past performance is no guarantee of future results.

When you turn on the news lately, it is easy to feel overwhelmed. The war in Ukraine is now entering its fourth year. Conflict in the Middle East continues to escalate. The global landscape feels increasingly fractured.

Many of you have reached out with a very prudent question: How do these conflicts impact my financial future, and are we prepared?

The short answer is yes. And not just because of recent moves we’ve made, but because of decisions we made well before the headlines turned dark.

The Strait of Hormuz: Why This Is Different

Typically, the stock market impact of conflict in the Middle East is short-lived. But this time, things might unfold a little differently.

Let’s dive into what’s happening in the Persian Gulf right now.

On March 4, 2026, in response to US attacks, Iranian forces declared the Strait of Hormuz closed, threatening and carrying out attacks on ships attempting to transit the waterway. The Strait is the world’s single most critical energy chokepoint. Its closure has put at risk roughly 20% of global oil supply, alongside critical volumes of jet fuel, LNG, and natural gas serving Asian and European markets.

Brent crude surpassed $100 per barrel for the first time in four years, rising to $126 per barrel at its peak. Even at $90 per barrel, this is a 50% jump from a month ago. 

The International Energy Agency has characterized this as the “greatest global energy and food security challenge in history.” And it is unlikely to be a temporary spike. 

Unlike sanctions-driven disruptions, a sustained blocking of the Strait obstructs not only trade routes but the very ability of producers to export. There is no easy workaround for a physical chokepoint controlling a fifth of the world’s oil. 

The ripple effects extend well beyond energy. 

Roughly one-third of global fertilizer trade moves through the Strait of Hormuz. Urea prices have already surged from $475 to $680 per metric ton. And with the spring planting window approaching in the Midwest, the implications for food inflation are significant. Aluminum, petrochemicals, and industrial inputs are all facing simultaneous pressure.

The World Has Changed, Maybe Permanently

For decades, the global economy was built on a simple premise: open borders, cheap energy, and the free flow of goods. That era, what economists call “peak globalization”, is behind us. It ended a year ago with the Trump Tariffs.

What’s replacing it is a world of higher energy costs, fractured supply chains, and intensifying competition for critical resources. This isn’t a temporary disruption. It’s a structural shift. And it has profound implications for your portfolio.

When global tensions rise, the economic effects are predictable. 

Foreign investors grow hesitant to hold U.S. stocks and bonds. We saw this clearly when long-term Treasury yields spiked as foreign holders sold first and asked questions later. Less demand for U.S. debt pushes bond prices down and interest rates higher. And a lower demand for US assets results in a weaker US Dollar.

A weaker dollar makes imports more expensive. Supply chain disruptions keep inflation sticky. The result is a persistent, grinding pressure on purchasing power that doesn’t resolve quickly.

This is not a prediction for a market “crash.” Rather, it is a regime change which will reward investors who are positioned correctly.

What We Own and Why We Owned It Early

Long before the current conflicts dominated the headlines, we made a deliberate decision to build positions in commodities and global infrastructure companies in most of our portfolios. Not as a reaction to war, but as a recognition of where the world was heading.

That positioning is looking like it’s paying off. Here’s what we hold, and why each piece matters:

Energy sits at the center of every geopolitical conflict today. Whether it’s Russian natural gas, Middle Eastern oil, or the global race to secure LNG supply routes, energy is the currency of modern geopolitics. Higher energy costs feed directly into every other price in the economy.

Uranium is the quiet story most investors are missing. As Europe scrambles to reduce its dependence on Russian gas and governments worldwide accelerate nuclear energy programs, uranium demand is structurally rising. Supply has been constrained for years. This is a long-term tailwind, not a trade.

Gold Miners serve as our inflation hedge and our insurance policy. Central banks around the world have been buying gold at record rates, diversifying away from U.S. dollar reserves. When confidence in the global financial system wavers, gold historically holds its value. Our miners give us leveraged exposure to that dynamic.

Agriculture and Fertilizer Companies are our newest addition, and perhaps the most overlooked opportunity in this environment. Ukraine and Russia together account for a significant share of the world’s wheat, corn, and fertilizer exports. Prolonged conflict doesn’t just displace people, it disrupts food supply. Fertilizer shortages ripple through to crop yields, which ripple through to grocery prices worldwide. As the world moves past peak globalization, food security is becoming a geopolitical priority. We want to own the companies at the center of that.

Global Infrastructure rounds out the picture. Roads, bridges, ports, pipelines, power grids, communication towers, and data centers. These are the physical backbone of the global economy and require massive investments as supply chains are restructured and reshored. These companies generate stable, long-term cash flows and tend to perform well in inflationary environments.

Taken together, this isn’t a collection of opportunistic bets. It is a coherent thesis: a world of deglobalization, higher energy costs, and persistent inflation rewards real assets. We have been building toward this thesis since last year.

The “All-Weather” Portfolio in Action

We do not build portfolios based on fear, or whatever is trending in the news. We build all-weather vehicles designed to find growth even when headlines are dominated by geopolitical strife.

Beyond commodities and infrastructure, we have also increased our allocation to international developed and emerging market stocks, regions that offer strong growth opportunities and trade at far more attractive valuations than U.S. equities. 

Last year, we modestly reduced domestic equity exposure to make space for our global infrastructure allocation. We also added a long-short equity fund. Historically, such funds have only been available to the ultrawealthy via hedge funds, and they provide a hedge during volatile periods without sacrificing our core participation in U.S. markets. And for the rest of our US equity allocation we’re maintaining our exposure companies with fortress balance sheets and strong cashflows.

On the bond side, we are keeping maturities short, mainly in the 3 month range to avoid interest rate risk. And we’re supplementing this allocation using private credit and real estate debt funds, with yields currently in the 9–10% range.

The thought process connecting all of these decisions is the same: the world is moving towards higher energy costs, higher food prices, and persistent inflation. The portfolios best equipped to navigate that environment own real assets with real cashflows, not just financial promises of future growth.

The Impact of Midterm Election Years

The impact of midterm election years on market volatility is also worth noting. 

Since the S&P 500 was created in 1957, the index has suffered an average intra-year drawdown of 18% during midterm election years These corrections occurred in 12 of the 17 midterm elections, or about 70% of the time. (source: Nasdaq) 

We are currently in one of those years, and a geopolitical shock of the magnitude we’re currently facing only amplifies that historical tendency. This kind of volatility is not a signal that something has gone permanently wrong. It is the just price of admission for long-term investors. 

On the positive side, the 12 month period following a midterm election has always seen the S&P 500 go up, by an average of 32% one year from the midterm year low.(source: Baird Wealth) 

Trying to time your way around that volatility is, historically, a losing game.

The Bottom Line

I’ll be honest with you: no one knows how long the Strait will remain closed, or when this conflict will end. But markets have absorbed oil shocks, wars, pandemics, and political upheaval — and they have recovered every single time. 

What separates investors who build wealth through these periods from those who don’t is rarely intelligence. It is patience and discipline. 

Your portfolio was not built on the assumption that the world would stay calm. It was built for exactly the opposite. Energy, gold, agriculture, infrastructure – these positions are not reactions to a crisis. They are the result of years of deliberate preparation for one. You are not watching this unfold from the sidelines. You are positioned at the center of it. 

Trust the process we have built together, and please don’t hesitate to reach out anytime. I am here, and I am watching this closely on your behalf.

As always, keep calm and stay invested,

Nirav

Risk Disclosures: This general information is not to be considered investment advice. Past performance is no guarantee of future results. Any investment included, whether stocks, bonds, alternative assets, cryptocurrencies or commodities may not be suitable for all investors. Please consider your risk tolerance and talk to your advisor before making any decisions based on this information.

Along with nearly everyone else, I was recently watching the Super Bowl. While the game itself was mildly entertaining, I was more interested in the pre-game and half-time shows, and the commercials.

I felt a strange sense of deja vu as I watched the endless parade of advertisements for Artificial Intelligence companies. It reminded me vividly of January 2000, where companies like Pets.com Monster.com aired just weeks before the tech bubble burst.

By mid-April 2000, the Nasdaq was down 25% and by mid-November 2000, most of these high-flying internet stocks were down 75%.

This year, 15 of the Superbowl ads featured AI, costing an average of $8 million each. While the technology has changed, the euphoric spending feels historically familiar. And unfortunately, the market behavior is starting to rhyme with 2000 as well.

Here is what we are seeing in the data and why our “all-weather” approach is more critical than ever.

1. The Great Rotation Has Begun

For the last few years, we have witnessed the extreme concentration risk in US Tech stocks.

The SP500 is now highly concentrated in a handful of mega-cap Tech stocks, with about 35% of the index comprising of the Magnificent 7 stocks.

These stocks have had a terrific run over the past decade, but in the past 12 months (ending Feb 13th), they’ve returned 11.70%. A healthy return for sure, but severely underperforming our international stocks (between 42% and 61%), Uranium (40%), Gold Miners (60%), Long-short equity (20.6%), Small-cap value (19.9%), and Global Infrastructure (17.3%).

Their dominance is fading, and we are now seeing a dramatic reversal that mirrors the topping process of March 2000.

Year-to-date (as of Feb 13th), the “Mag 7” and broader tech sectors are struggling (Mag-7 is down 7.3%) recently), the “boring” parts of the market are surging:

• Energy: Up 21.6%
• Materials: Up 17.5%
• Industrials: Up 12.3%
• Consumer Staples: Up 15.2%

This is the exact pattern we saw when the Dotcom bubble popped. Investors rotated out of expensive hype and into real assets, and real companies with real cash flows.

2. The “Plumbing” of the Bubble

In 2000, the narrative was about the “fiberoptic backbone” of the internet. Today, it is about the “data center backbone” of AI.

Back then, WorldCom saw its free cash flow plummet even as it reported solid earnings—a discrepancy that eventually revealed massive accounting issues. Today, we are seeing hyperscalers (the big tech giants) facing plummeting free cash flow as they spend billions on infrastructure.

Even more concerning, accounting firms are raising red flags. We are seeing companies like Meta keep massive data center projects off their balance sheets to obscure the true cost of this buildout. While this doesn’t necessarily mean fraud, it does mean that earnings quality is deteriorating.

3. Speculation vs. Investing

The telling sign of a mania is always trading volume. Average daily equity turnover recently crossed the $1 trillion mark—a 50% increase from last year.

To put that in perspective: during the peak of the Dotcom mania in 2000, daily turnover was only around $50 billion. Today’s market is being driven by leveraged ETFs and zero-day options, creating a casino-like atmosphere that historically ends in a sharp correction.

And crypto-currencies, what I consider the ultimate store of speculation, are already in a bear market this year. This is a potential sign of decreasing in risk appetite that could spread to other sectors.

What This Means For Your Portfolio

None of this is meant to alarm you, but to validate the defensive moves we have made over the last 12 months.

When we trimmed our US Large cap exposure and moved into a Long-short strategy, Global Infrastructure, and Commodities, we did so to insulate your wealth from exactly this kind of speculative unwind.

• We own the “boring” stuff: The energy, and commodity sectors that are currently rallying are core parts of our value strategy.
• We stepped out of the “Crowded Trade”: With US market concentration now higher than it was in 1929 or 2000, we have significant exposure to International Value to escape the historic risk of a top-heavy market.
• We focus on cash flow: We prioritize companies that return capital to shareholders today, not those promising AI profits ten years from now.

The bursting of a speculative bubble is never painless for the broader market, but it is often the healthiest thing for long-term returns. It clears out the excess and allows capital to flow back to high-quality companies trading at fair valuations.

As we navigate this volatility, remember that your financial plan was built for this. We are diversified, we are defensive, and we are watching the data, not just the commercials.

If you’d like to discuss your investments, or your financial plan, please don’t hestitate to reach out or find some time on my calendar.

As always, let’s all keep calm and invest,

Nirav

Risk Disclosures: This general information is not to be considered investment advice. Past performance is no guarantee of future results.

We often hear that a “fiduciary” is simply someone who doesn’t sell commissioned products and hates annuities. While that is a good starting point, the definition of a true fiduciary goes far beyond how they are compensated—it is about how you are served.

Serving as the steward of a family’s wealth is a privilege. However, I speak with many investors who believe they are getting fiduciary care, only to find their financial interests are taking a backseat to a firm’s standardized model.

How can you tell if your advisor is truly acting in your best interest?

Here are a few red flags that suggest you might be part of a sales machine rather than a comprehensive financial plan:

• The Taxable Account Trap: You open your statement and see hundreds of individual securities in your taxable account, yet your retirement accounts hold the tax-efficient ETFs. Not only is this backward, this often results in a “surprise” 6-figure tax bill due to high turnover. A true fiduciary cares about your after-tax return, utilizing strategies like tax-loss harvesting or 351 exchanges to manage customized positions.

• The Missing Safety Net: You are a few years out from retirement, yet there are no bonds or alternatives in your account. While we want growth, an “all-weather” portfolio requires diversification, such as gold, private credit, or short-term treasuries, which protect you when headlines turn volatile. Being 100% in equities near retirement isn’t a strategy; it’s a risk.

• The “Check-In” Call: Your advisor calls you on your birthday, your anniversary, and even your kids’ birthdays just to “check in.” But they never answer the hard questions: “When can I retire?”, “What is the most tax-efficient way to take a distribution?”, or “How do I prevent my wealth from ruining my kids lives?”.

The Reality Check Real wealth management is not just about beating a benchmark; it is about aligning your portfolio with your life. It involves proactively planning for tax changes, managing liquidity for major purchases, and ensuring your estate plan is sound.

If your advisor is great at remembering dates but absent when it comes to actual financial planning, it might be time to ask if they are truly a fiduciary—or just a friendly asset manager.

Let’s ensure your financial plan remains aligned with your real-life needs for 2026.

Keep calm and invest,

Nirav