Each month, CAISSA performs an analysis of prevailing global events, assessing their potential influence on our client’s wealth plan. We are diligently having strategic discussions with our portfolio managers, ensuring that our position remains informed and aligned with current market dynamics.

Below, you will find CAISSA’s perspective on key topics markets are digesting post-election.

Economic Growth Concerns Linger Despite Market Rebound

In the first quarter of 2025, U.S. economic growth slowed slightly, while inflation pressures continued to rise.

CAISSA Perspective: The current headlines reflect a market balancing optimism from strong earnings and trade developments with ongoing concerns about economic slowdown. Many companies are showing resilience in a challenging environment, with 75% of the companies that have reported beating earnings estimates. However, signs of moderating job growth and consumer spending point to underlying headwinds. At Caissa, we remain focused on diversification and high-quality investments, anchored in long-term fundamentals. We continue to align portfolios with the goals and objectives of the financial plan, ensuring clients are well-positioned to benefit if economic conditions improve.

Monetary Policy Uncertainty Is Easing, But Not Gone

The Fed is maintaining elevated interest rates to manage inflation but creates a more stable backdrop.

CAISSA Perspective: Monetary policy appears to be entering a more stable phase, reducing uncertainty for businesses and investors.  At its May 2025 meeting, the committee maintained the federal funds rate at 4.25-4.5%, marking the third consecutive meeting without a change. The Fed acknowledged that economic activity continues to expand at a solid pace, with unemployment stabilizing at a low level. The Fed emphasized a data-dependent approach, stating it will carefully assess incoming information and the evolving economic outlook to determine the appropriate stance of monetary policy. As markets adjust to the reality of a ‘higher for longer’ rate environment, we’re identifying opportunities that tend to benefit from structural advantages or interest rate sensitivity. In this environment, higher rates reward selectivity and quality, and companies with strong balance sheets and consistent cash flow are more attractive. Fixed income is investable again, with high-quality short to intermediate duration instruments offer attractive yields without reaching for excessive risk. Additionally, the higher rate environment tends to lower the correlation between stocks and bonds, enhancing diversification benefits and reducing portfolio volatility during periods of uncertainty.

Market Breath Holding Up Despite Strong Selloff Suggests An Increase In Broad Market Participation

Even though the headline indexes pulled back, many stocks continued to perform relatively well.

CAISSA Perspective: Broad participation in the market suggests it isn’t being driven solely by a few mega-cap names but rather reflects healthy underlying demand. The resilience of many stocks helps reduce the risk of a deeper correction and indicate investor confidence may still be intact. Following the sharp selloff triggered by tariff announcements in early April, the market has demonstrated a remarkable recovery. The S&P 500 embarked on a nine-day winning streak, the longest in over 20 years. At Caissa, we adhere to a disciplined approach guided by your comprehensive wealth plan. Rather than making reactive portfolio changes in response to short term market fluctuations, we focus on long term objectives and strategic asset allocation. As we navigate ongoing uncertainties, we remain cautiously optimistic and continue to seek opportunities for diversified portfolios to find value.

“Why There Will Never Be Another Warren Buffett”

In his recent Wall Street Journal column, Jason Zweig reflects on Warren Buffett’s unparalleled career as the 94-year-old investor announced his retirement from the CEO role at Berkshire Hathaway at the end of this year.

Zweig attributes Buffett’s success unique success to three main factors: the person, the period, and the package. Buffett’s brilliance and focus on markets since age 11, and willingness to sacrifice personal life for investing set him apart. He capitalized on a historical period characterized by less competitive markets, allowing him to exploit opportunities modern investors cannot. And, the “package” that is Berkshire, a flexible, long-term investment vehicle, gave him structural advantages over typical fund managers who prioritize fees and short-term performance pressures over bold strategies.

CAISSA Perspective: Drawing inspiration from Buffett’s principles and considering the current market context (higher for longer rates, tariff recovery, and Fed stability), Caissa’s investment approach aligns with these enduring strategies. 

• Prioritizing quality equities and balancing with fixed income. We focus on quality investments and partnering with top managers, while maintaining a balanced allocation with fixed income to manage risk effectively.
• Diversifying trade risks and maintaining flexibility. Our portfolios are structured to mitigate trade-related risks through diversification and to adapt to changing market conditions with agility.
• Focusing on long-term goals and filtering out short-term market noise. We remain committed to our client’s long-term wealth plan, avoiding reactive decisions based on short-term market fluctuations.

By adhering to these principles, we aim to navigate the evolving economic landscape with the same discipline and foresight that characterized Buffett’s illustrious career.