Has the US dollar become too weak? GLP-1 drugs; what’s the concern? Is the US housing market becoming a buyers market? How would an S&P 500 Portfolio Work in Retirement? & More

Has the US dollar become too weak?

It can be difficult to filter through the headlines that make it appear that the dollar has dropped and lost 50% of its value and is getting close to collapse as some doom and gloom people would want you to believe. The truth is since January 2025; the dollar has been down about 10% against other major currencies. Keep in mind that it fluctuates every day, every hour, and every minute. This is normal, but the headlines can be very scary and it's also important to understand that over the last five years the dollar index has been up about 7%. There are pros and cons to a weak dollar. If you’re planning on traveling to Europe or some other foreign country, hotels and other items will cost you more when the dollar weakens since our dollar buys less. Also, the price of foreign cars and trucks will increase because again a dollar buys less. But the other side of the coin is that people from other parts of the world can now come to the United States and spend money in our economy since their currency now goes further. Also, many of our products that we export will be less expensive so exports should increase while our imports decrease, reducing our trade deficit. Lower interest rates can cause our dollar to fall, but a strong economy can help counterbalance that decline. Will there be a default on the dollar? The chances of that happening are extremely low for many reasons. The US dollar is still the dominant global reserve currency, which adds strength to the dollar. It is also understood that yes, we do have high debt, but also if needed, the US can print dollars to pay that debt. Looking forward to 2026, there’s a very good chance that the dollar will stabilize as the economy improves. Foreign top trading partners have pledged to invest $5 trillion in the United States. With that large investment, more travel to the US, and people buying more US products such as cars that are now a better deal due to tariffs and a weaker dollar, come the end of the year, we could actually see a firmer dollar, a booming economy and perhaps further declines in gold and silver that are still near all times highs. I get excited, just writing about it, but it will require patience for investors as I do see this as a volatile year. 

18% of US adults have taken GLP-1 drugs. What’s the concern?

The price of GLP –1 drugs have come down and roughly 18% of adults in the US are using them. But there are other considerations outside of just weight loss. These drugs came out to treat type 2 diabetes and obesity not as a lifestyle change to lose 20 or 30 pounds. It is estimated that about half of people will stop taking the drug after one year and will probably be very disappointed with their future weight management. Studies have shown that when people stop taking the drug within about a year and a half, they regain most of the weight they lost. Studies also show that the weight gain comes four times faster than those who lost weight through normal dieting. While on these drugs, people see their blood pressure, cholesterol, and blood glucose levels improved, but when they’re off the drug in a little over a year, those levels go back to where they were. Kevin Hall is a former senior investigator at the National Institute of Health and a specialist in nutrition. He says once you’re off the drugs, your appetite will be much higher than it was and you could end up overeating, which leads to taking in too many calories. Another study shows people who gain weight back and decide to go back on the medication that it’s not as successful the second or third time. People also don’t realize a thing called weight cycling or gaining and losing weight and how that can affect the percent of fat to muscle. It is estimated that when you lose weight about 25 to 30% of it is muscle. But the sad part is when you have the weight gain after you’re off the drugs, it is unfortunately more fat than muscle. So, as you can see, this is not a good cycle or a good plan for 10 to 20 years. If one thinks it is a good idea to just stay on these drugs for life, there are long-term risks such as gallbladder diseases, pancreatitis, and kidney damage. The kidney damage is one that would really worry me because as you get older and you have more pain you may want to take a pain reliever like Advil or ibuprofen, but doctors now look at people’s kidneys to see if they can handle Advil or ibuprofen, which is another strain on your kidneys. Being concerned with how you look and taking the easy way to look better by popping a pill or taking an injection may cause you to have regrets when you’re older.

Is the US housing market becoming a buyer's market?

From 2020 to about 2022 it was definitely a seller's market and people could ask whatever they wanted for their home and if you didn’t take it, there would be 10 people behind you that would. Well now things are changing back to where buyers can negotiate and sometimes even get a price below the asking price. Nationwide, about 62% of homebuyers purchased their home under the listing price. The discount of 8% was also the largest since 2012. Buyers are also obtaining concessions from sellers which could be things like cash for closing costs or buying down the mortgage. As recently as December, there were 600,000 more sellers than buyers and that’s the biggest gap going back to 2013. What is helping the housing market is mortgage rates have declined a little bit, which has made homes somewhat more affordable for some buyers along with the cool-off in prices that we have seen. The best place to buy a home currently is Florida and Texas because new home construction has created a big supply of homes for sale. It can really depend on the local market you are looking at, but if you’re buying in West Palm Beach, Fort Lauderdale, or Miami, about 85% of homebuyers paid under the original listing price. However, if you’re buying a home in Newark, New Jersey, San Francisco, or San Jose, only 39% received a discount from the original list price. It was also noted that those markets had a low amount of new construction. There could be more to come if the supply increases, and prices ease somewhat as it would likely bring more buyers back into the market. Depending on where you’re looking at buying, perhaps 2027 will be a great time to buy home.

The US census numbers are out, and things are changing in our country

As of June 30, 2025, the US census showed the United States had 341.8 million people. This was an increase of only 0.5% from the previous year and the slowest growth since 2021. Births in the United States were at about 3.6 million, which is only up 12,200 compared to 2024, but is better than the 40,700 decline in 2024. International immigration took a big hit in the first six months of 2025 as net international migration growth fell from 2.7 million in 2024 to 1.3 million in 2025. States like California saw the biggest change in net international migration with a decline of 200,000 compared to the previous year. This was followed by New York at just under 200,000 and Texas at around 180,000. California also continues to lose people to other states, and in recent years the net loss has been around 250,000 people per year. This, paired with lower international migration and low birthrates, caused California to be one of the only states with a population decline during the year. The Midwest seems to be the place to go due to affordable housing, and if you can handle the weather, South Carolina was the nation's fastest growing state. Florida still had growth in their state, but it was under 25,000 people. This was far below 2022 when it was over 300,000 people and in 2023 when it was around 175,000 people. Why is it important to have a growing population? With a growing population, new businesses and services can be offered and grow along with the economy. However, if you have a declining population, the opposite is true and businesses will begin to slow down and close. This could then cause the economy to slip into recessions and even long depressions.

Gold, gold, gold

Everybody seems to want to talk about gold because of how well it has performed since the beginning of 2025. Since everybody likes talking about gold, let’s discuss some things about gold that may help you. If you’re thinking about buying gold or even silver for that matter and you can’t explain with confidence why gold was up over 70% this past year, then you may not want to buy it. It’s very important to be honest with yourself that you really have some understanding of what caused gold to increase so much because the same thing that made it increase could also cause it to decrease. People will often say it’s great to hold gold for the long-term but going back 235 years, you’ll discover that gold outpaced inflation by less than half of 1%. With the recent run up, it looks pretty good over the last 10 and 20 years, but is this a peak for gold or is there more to come? At our firm, we do favor investing in equities and real estate, but it is worth noting that the ratio of the S&P to the price of gold has broken down. This has only happened four times in history. Unfortunately, for those in the S&P 500 and investing in stocks blindly each of those four times in history stocks remained range bound for many years. As a tip, if you like equities like we do, I believe you’ll have to find equities on sale that also pay a good dividend to provide you with good returns going forward.

The AI investment is not paying off for Microsoft.

 Microsoft's stock climbed dramatically over the last few years and reached a peak of $555 just a few months ago, but today it trades in the low $400s and has seen a drop of around 25% from its peak. What is the problem? One of the issues I see is they have been bragging about their new AI technology known as Copilot, but the results haven't been very impressive. The company has around 450 million users of Office 365, but the CFO, Amy Hood, revealed they only have 15 million paying Copilot users. If you do the math, that is less than 3% of the company's 450 million users, yet Microsoft has been spending billions and billions of dollars on capital expenditures. The company reports their earnings on a fiscal basis and last fiscal year they spent $88 billion on capital expenditure. They are currently about halfway through fiscal year 2026 and they have already spent $72 billion on capital expenditures. Does that mean that they’ll be spending $144 billion on capital expenditure, not necessarily, but I’m confident they’ll be spending more than $88 billion. Copilot came out in March 2023 and nearly 3 years later all they have to show for all the money they have spent is those 15 million paying Copilot users. At our firm, we do not pay for Copilot, so I’m not sure about the benefits and while I have read that people love using AI it appears many don’t see a benefit in paying for it each month. Even with the $100 plus pullback in the stock price, the stock remains pricey trading over 25 times forward earnings.

Should you use a Buffer ETF if you’re concerned about a stock market pullback?

Like many things on Wall Street, they are always trying to come up with ideas on how to protect people in down markets that still offer good returns. While it sounds nice, many of these products produce lackluster results in the long term and generate more fees for Wall Street. Brokers selling on fear will talk about the upside of how this may allow you to sleep at night knowing if the market falls you are protected. There’s about $70 billion spread throughout almost 360 funds that are considered Buffer ETFs with fees averaging about 0.8% and that could be as high as 1%. Think about if the advisor is also charging you a 1% management fee, your total fees are now 2%. There are three basic Buffer ETFs: a 10% buffer, 12% and then 20%. As an example, if you had the 10% buffer ETF and the market dropped by 22%, you would only have a negative return of 12%. But it also works on the opposite side to where if the market went up 22%, your gain would only be 12%. People may want to invest in these because of emotions, which is never good when it comes to investing. The thing they are missing out on is the huge compounding effect when you have a 20 to 25% gain, it can really boost your portfolio returns. If your portfolio is being managed to avoid high risk in investments, you will probably do much better because of compounding. The other concern I have is as these funds become bigger, they use put and call options on the S&P 500. This is a very big market, but throughout history, we have seen times where these fancy strategies using options don’t always work out. To build good long-term wealth, investors must stop being so concerned about short-term pullbacks and instead focus on the longer-term gains.

The labor market continues to cool

When listening to Fed officials discuss whether to cut rates, one area of concern has been the labor market. Unfortunately, with the recent Government shutdown, we will not get payroll data until next week. We were supposed to see the data on Friday. Even though we didn’t get that major report, we did get the Job Openings and Labor Turnover Survey, also known as JOLTs, for the month of December. The numbers weren't pretty. Job openings fell to 6.54 million, which came in well below the estimate of 7.25 million openings. It was also a drop of 386,000 from the downwardly revised November total and the lowest level since September 2020. This did push the ratio of job openings to unemployed workers to 0.87 to 1. At the peak this number topped 2 to 1. While this sounds troubling, I still wouldn't necessarily panic over the labor market and the broader economy. This is a small set of data when looking at the grand scheme of things, and the labor market is adjusting from an extremely elevated level of strength. With that said these reports will be worth watching in the months to come and if there is further softening, you could see the need for more interest rate cuts at the Federal Reserve. 

Mobile phone screeners, a good idea or a pain in the butt?

Recently, Apple came out with call screening when it updated iPhones last year with iOS 26. They’re about seven years behind Google who came out with their call screening tool back in 2018. I’m rather old-fashioned. It used to be when I wanted to talk to somebody, I would just pick up the phone and give them a call. If they wanted to talk, they would answer. If not, I would leave a message. Well now, apparently some people feel before you call them; you should text them first to see if it’s OK to call. I just don’t get that. Why would I take extra time to text you to see if it’s OK to call you? Just don’t answer the phone if you’re busy and call me back when you're available. The call screening feature uses an automated voice to ask unknown numbers for their names and reason for the call. It will then transcribe the answer and allow recipients to determine whether they want to take the call. My initial thought when I was looking at writing this post was, I was kind of irritated by it, but then I saw a recent report that every month Americans receive over 2 billion robocalls. I don’t know how many calls I receive a day, but I know it’s a lot. I do like the feature that it tells me if it’s likely a spam call and thinking through this screener, maybe it is a good idea. One downside I do see is as a business owner with about 900 clients, not all of them have our phone number in their mobile phones and that could take longer to get hold of them. I think overall, as I said, it’s probably a good thing and I guess just calling up a friend to talk or dropping by somebody’s house just to say hello is no longer acceptable.

Financial Planning: How Would an S&P 500 Portfolio Work in Retirement?

Many investors nearing retirement feel comfortable staying fully invested in the S&P 500 because recent performance has been strong, but that confidence is often based on a short window of returns rather than the long reality of retirement. Retirement can last 20 to 30 years, and during that time markets will go through multiple corrections and bear markets. Once withdrawals begin, even modest withdrawal rates can amplify losses and deplete a portfolio. The late 1990s provide a clear example when the S&P 500 produced annual returns in the 20% to 30% range for several years in a row and many investors came to believe strong gains were easy and would continue… then 2000 came. Someone withdrawing an inflation-adjusted 4% from an S&P 500 portfolio in 2000 saw the account fall to roughly half its value within just three years, meaning a retiree at 62 with $1 million was left with barley $500k by 65. For those who stayed invested, after the Great Recession 9 years into retirement around age 71, the portfolio had lost close to 2/3rds of its original value.  At that point, the withdrawal rate needed to continue income was now 14%, up from the original 4%. Today the S&P 500 sits near all-time highs and trades at historically elevated forward earnings multiples, mirroring the late 90’s. While the index has delivered roughly 10% annual returns over the long term, those averages hide the danger of sequence of returns risk, where starting withdrawals before or during a downturn can permanently impair a portfolio and leave too little capital to fully recover even when markets eventually rebound.