Quarterly Market Update 9.30.2024

Greetings. Scott Campbell, your 401(k) investment advisor with my quarterly investment

update.

The U.S. stock market performed very well in the third quarter of 2024, up almost 6% for the

quarter and up 21% year to date. The bond market also performed very well in the third quarter with yields from short to long term returning to levels not seen in a very long time. Short term yields still outperform medium and long term year to date.

The performance in September was very surprising because September is generally a volatile month, especially when leading up to a national election because of the uncertainty before the election.

Octobers are, historically, the most volatile month of the year, which is amplified when leading up to a national election. Markets have historically done well after the election regardless of the outcome because of the clarity the outcome provides. The fourth and first quarters are the best performing quarters of the year due to the strength of the economy from consumer spending.

The economy continues to grow, but at a slower pace, which is normal for this time of year.

Employment which is a function of the economy is also softening. Although there was a

surprisingly good employment report for September. All in all the economy is in good shape.

I will continue to sound the alarm regarding the federal government debt which is over $35

trillion. The current administration and congress have added over $7 trillion to the debt. The

most in history. The current debt represents 100% of GDP. Not to long ago that was

considered to be unthinkable. The annual interest payment on the debt is over $1 trillion. That is more than the annual budget for national defense.

I need to dispel some myths:

1. Taxes will not solve the debt problem. There is not enough income or revenue to tax.

2. The idea that the wealthy just need to pay their “fair share”is a canard. Currently the top

1% of income earners pay 26.3% of all federal income taxes. The top 50% of income

earners pay 97.7% of all federal income taxes. When asked, anyone who spouts this “fair

share” line can never state a specific amount. Its just class warfare.

3. Tax cuts by themselves do not add to the debt. Revenues to the U.S. Treasury have

increased following all the major tax cuts throughout history because tax cuts generate

economic growth which generates revenue to the Treasury.

4. But economic growth alone will not erase the debt.

The government must cut spending. But that is just basic common financial sense. We all

understand that. When our households fall into debt we have no choice but to cut spending.

It’s really very simple.

If you have any questions or need help, please reach out.