The Economy
While recent headlines have leaned toward sensationalism regarding AI’s disruption of the labor market, we view the integration of artificial intelligence as a secular tailwind for long-term productivity growth and therefore the economy. Concurrently, high-profile layoffs often dominate the financial press but remain statistically marginal within a robust workforce of 160 million. Furthermore, high-frequency indicators continue to signal underlying labor market stability. As we look toward upcoming payroll figures—projected in the 50,000 to 100,000 range—it is evident the labor market is transitioning from the immigration-led employment surges of last year toward a sustainable, steady-state equilibrium. With Q1 GDP tracking near 3%, the data points to a significant increase in output per worker. This fundamental shift is inherently disinflationary and is being further supported by a cooling housing sector. As the largest component of CPI, the stabilization of national rents and the deceleration of price growth to 1%–2% provide a clear path for cooling inflation. In response, the 10-year Treasury yield has retraced below 4%, signaling the market’s confidence in moderating price pressures and an eventual alignment with the Federal Reserve’s target of 2%–2.5%.
The Markets
In equities, we are witnessing a healthy structural rotation rather than a distress-driven retreat. The initial AI-concentrated rally is broadening into a more inclusive and resilient market. While mega-cap leaders, including NVIDIA, have experienced post-earnings volatility, their valuations remain extremely reasonable, trading near 15x 2027 projected earnings. This suggests the market is not abandoning these leaders, but rather discounting future innovation risks and the natural narrowing of competitive moats. This recalibration has created a favorable environment for mid-cap, small-cap, and value sectors, with eight of nine U.S. style boxes maintaining positive year-to-date performance. Furthermore, the importance of a globalized portfolio has rarely been more apparent. While the S&P 500 has moved into a period of consolidation, we are seeing significant momentum in Japan, Europe, and key Emerging Markets. This geographic broadening underscores a global transition: an AI-enhanced future characterized by higher manufacturing output and the re-emergence of old economy industries.
Wealth Planning
Advanced Health Care Directive
As part of our series on estate planning, an advanced health care directive qualifies as an essential item for you have.
An advanced health care directive (AHCD)—also called a living will—is a legal document that explains your medical care preferences if you become unable to speak for yourself. It often includes two key parts: (1) instructions about treatments you would or would not want (such as life support, tube feeding, or resuscitation), and (2) the designation of a health care proxy or durable power of attorney for health care—someone you trust to make medical decisions on your behalf. The primary purpose of an advanced directive is to protect your autonomy, reduce uncertainty for loved ones, and guide medical teams in honoring your values, beliefs, and goals of care during serious illness or injury.
You should review your advanced health care directive periodically to ensure it still reflects your wishes. A helpful guideline is to revisit it every few years or whenever any of the “Five D’s” occur: Decade (new decade), Death of a loved one, Divorce/family change, Diagnosis of a serious illness, or Decline in health. Laws can also vary by state and occasionally change, so reviewing the document after moving is important. Keeping it current, sharing copies with your proxy and health care providers, and discussing your preferences openly can help ensure your decisions are respected when they matter most.