March Madness is heating up. This weekend we will be rolling into the Sweet 16 round of NCAA basketball where the top teams go head to head, competing for the Elite Eight, the Final Four and finally the championship game. Although our local team, UC Irvine, didn’t make it past the second round, there is still much excitement ahead. If NCAA basketball is not your game, there are some other acronyms to pay attention to like the IRS, and the FRB (Federal Reserve Board).
As far as the IRS goes, its tax time and the filing deadline is coming up. We’ll save the commentary for how Californian’s fare with the new tax laws for a different newsletter. In the meantime, Federal Reserve Chair Jerome Powell announced last week that the Fed will not plan on any further interest rates increases for 2019. This immediately impacted the bond market, causing concern that the global economy may be weaker than expected. Bond yields declined on the announcement as the yield curve flattened and continued to invert and equity prices fell slightly.
Unlike the NCAA, there is no end game in sight and you cannot run out the clock. It’s just a matter of forecasting and reaction to economic data. We believe the FRB is prepared to pivot and “control the ball” when necessary to keep the tempo of the economy from turning into “March Madness”.
-The Leisure Capital Management Team
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