Facts Not Fear – Perspective on the Markets & Economy

The media often paints an overly negative picture, stirring unease and influencing market sentiment. Recent market fluctuations are a case in point. Yet, beneath the headlines lies a powerful truth: the U.S. economy remains robust and resilient as we progress through 2025. The data—and even a casual glance at daily life—tells a story of strength and opportunity.

Restaurants are bustling, shopping centers are lively, and everyday activity reflects a thriving economy. Tune out the news or social media for a moment, and you’ll likely see it for yourself: things are going well. Our role is to help you cut through the noise, stay grounded in the facts, and pursue long-term financial success.

Key Highlights of the U.S. Economy in 2025

Strong Job Growth: The U.S. labor market continues to shine. The national unemployment rate dropped to 3.9% in February 2025, down from 4.1% in December 2024, according to the Bureau of Labor Statistics. February alone saw 151,000 new jobs added—exceeding forecasts and showcasing robust hiring across industries.

Inflation Cooling Off: Inflation continues its downward trend, easing pressures on consumers and businesses alike. The Consumer Price Index (CPI) rose by just 2.8% year-over-year in February 2025— the lowest since 2021—while core inflation (excluding food and energy) slowed to 3.1% (U.S. Bureau of Labor Statistics). This stability fosters a healthier cost environment.

Steady GDP Growth: The economy grew at an annualized rate of 2.3% in Q4 2024, fueled by vigorous consumer spending and business investment (Bureau of Economic Analysis). This momentum signals resilience amid global uncertainties.

Housing Market Stabilization: Home sales are rebounding, with existing home sales up 4.2% in February— the third straight month of gains (National Association of Realtors). Slightly lower mortgage rates have improved affordability, spurring buyer confidence.

Manufacturing and Business Expansion: U.S. manufacturing output rose 0.8% in February, buoyed by stronger demand and smoother supply chains (Federal Reserve). Meanwhile, small business optimism remains strong with the NFIB Small Business Optimism Index at 100.5 in February — that this is the fourth consecutive month above the 51-year average of 98 and is 4.4 points below its most recent peak of 105.1 in December

Tech Sector Boom: Analysts expect 2025 to be the biggest year for venture investing since the heady days of 2022, thanks to an overall optimistic view of the global economy. (Forbes.com 1/24/25)

These indicators paint a picture of a solid economic foundation with room for growth, investment, and prosperity as 2025 unfolds.

Many clients have expressed concerns about the potential impact of tariffs. Here’s my take: tariffs aren’t inherently negative. They’ve been a cornerstone of U.S. economic policy for over 50 years and will likely remain so. More often than not, they serve as a strategic tool rather than a fixed policy.

Historically, tariffs—or even the credible threat of them—have driven fairer trade deals. In the 1980s, tariffs on Japanese electronics paved the way for agreements that bolstered U.S. manufacturing. More recently, tariffs have pressured China to address trade imbalances and intellectual property issues.

Today’s proposals follow this playbook: they’re leverage, not an endgame.

Beyond negotiations, tariffs offer real benefits:

• Protecting Domestic Industries: They shield American businesses from unfair foreign competition.
• Boosting Jobs: By incentivizing production at home, tariffs spur hiring and investment in U.S. manufacturing.
• Revenue Generation: Tariff proceeds fund critical areas like infrastructure, education, and workforce development.

Critics point to potential price hikes, but this overlooks the bigger picture. Tariffs can stabilize prices over time by fostering local production and insulating us from global supply shocks, a lesson learned during COVID-19. They’re not a silver bullet, but when used thoughtfully, tariffs strengthen trade fairness, national security, and economic independence.

It’s no wonder people are concerned given the negative media and polarized politics. However, 2025 isn’t a time to shrink back—it’s a time to lean in. Volatility will come; it always does. But for those who focus on the facts and the long game, this is a moment of opportunity. While there are certainly challenges facing the economy, we’re seeing growth, innovation, and a renewed sense of what’s possible. America isn’t just weathering the storm—it’s charting the course. Don’t let the media create unnecessary fear or worse, cause you to deviate from your financial plan.

Our entire team is here to help you make sense of it all. Together, we can turn uncertainty into action and build something lasting. Our entire team is here to help you seize these moments, answer your questions, and address any concerns.

 

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Any opinions are those of the author and not necessarily those of Raymond James. This material is being provided for informational purposes only and is not a complete description, nor is it a recommendation. There is no guarantee that these statements, opinions or forecasts provided will prove to be correct. Investing involves risk and you may incur a profit or a loss regardless of strategy selected. No investment strategy can guarantee your objectives will be met. Past performance is no guarantee of future results. Every investor’s situation is unique and you should consider your investment goals, risk tolerance and time horizon before making any investment decision.