STALEMATE IN THE CAPITOL

OCTOBER 4, 2021

Higher bond yields and a legislative stalemate in Washington, D.C., added up to losses for the week.

The Dow Jones Industrial Average declined 1.36%, while the Standard & Poor’s 500 lost 2.21%. The Nasdaq Composite index fell 3.20%. The MSCI EAFE index, which tracks developed overseas stock markets, shed 2.58%. ¹

An Ugly Week

The reality of a more hawkish Fed finally hit the bond market, sparking a sell-off in bonds that sent yields higher. Higher yields hurt technology and other high-growth companies, and that weakness spread to the broader market. (Higher yields can reduce the value of a company's future cash flow, which may reset valuations.)

Congress added to the market uncertainty. It was unable to advance an infrastructure bill, and it made little progress on the debt-ceiling agreement. After a sell-off to close out September, stocks surged on Friday on news of a potential Covid-19 oral therapeutic, an easing of yields, and reports that President Biden was traveling to Capitol Hill to help break the logjam on legislation.

Powell in the News

Fed Chair Jerome Powell was at the center of two news developments last week. The first was the announcement by a prominent senator opposing Powell’s renomination, heightening market uncertainty over the leadership transition when his term expires in February 2022. ²

Powell later made comments at a European Central Bank event, admitting that the current bout of inflation may last longer than he and many other central bankers have previously expected. But he remained steadfast that inflation would be transitory, attributing much of today's price pressures to temporary supply bottlenecks. Powell also said that he saw little evidence of building inflationary expectations from consumers or businesses. ³

This Week: Key Economic Data

Tuesday: ISM (Institute for Supply Management) Services Index.

Wednesday: ADP (Automated Data Processing) Employment Report.

Thursday: Jobless Claims.

Friday: Employment Situation.

^{Source: Econoday, October 1, 2021
The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to be providing accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts also are subject to revision.}

This Week: Companies Reporting Earnings

Tuesday: PepsiCo, Inc. (PEP).

Wednesday: Constellation Brands (STZ).

Thursday: Conagra Brands (CAG).

^{Source: Zacks, October 1, 2021
Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule when they report earnings without notice.}

FREE CHAIR YOGA!!!  Yes, that’s right…Free Chair Yoga offered weekly online.

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Breathe, Let go, Recharge.

Economic Events Causing Uneasiness?

Equity markets faltered sharply yesterday. This was the worst day for the markets in more than 6 months, even worse than the selloff from the Evergrande debacle. The markets are retesting their lows, which is very common, so no surprise to us. ⁴

READ MORE HERE

^{This communication is issued by Howard Capital Management, Inc. It is for informational purposes and is not an official confirmation of terms. It is not guaranteed as to accuracy, nor is it a complete statement of the financial products or markets referred to. Opinions expressed are subject to change without notice.} 

Who Qualifies for the Child and Dependent Care Tax Credit?

Let's outline who the IRS defines as a qualifying person under this care credit:

• A taxpayer's dependent who is under the age of 13 when the care is provided.
  
• A taxpayer's spouse who is physically or mentally unable to care for themselves and lived with the taxpayer for more than half the year.

In addition to spouses and dependents, the credit may also cover someone who is mentally or physically unable to take care of themselves and lived with the taxpayer for six months. This is the case if that person was the taxpayer's dependent, or if they would have been the taxpayer's dependent except for one of the following:

• The qualifying person received a gross income of $4,300 or more.
  
• The qualifying person filed a joint return.
  
• The taxpayer or spouse, if filing jointly, could be claimed as a dependent on someone else's return. ⁵

^{* This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax professional.}

Boost Your Productivity With These Tips

Take regular breaks. It seems counterintuitive, but most people are more productive when they take regular breaks.

Do the hard tasks first. Mark Twain famously said to "eat the frog first thing in the morning," meaning that you should tackle your most difficult task right away.

Make two to-do lists. One that has your weekly goals and objectives and one that has your daily tasks.

Divide large projects into manageable steps. Make the things on your to-do list specific so you can continue to cross things out and make progress. ⁶

Weeknight Pasta With Butternut Squash

^{2 Servings}

^{Total Time: 45 minutes}

Ingredients

• 1 tablespoon olive oil
• 4 ounces guanciale (or thick-cut bacon, if you can't find guanciale), cut into 1/2-inch dice
• 8 ounces butternut squash, cut into 1/2-inch dice
• 1 bunch Tuscan kale, cut into 1-inch pieces
• ¹/2 pound orecchiette
• Freshly grated Pecorino Romano, to taste
• Salt and pepper, to taste

Directions

1. Preheat the oven to 400°F.
2. Cut up the guanciale and butternut squash. Toss them onto a sheet pan, drizzle with the olive oil, shmoosh them around a little, and roast for 30 minutes.
3. Stir in the kale, and place back into the oven to roast for another 10 minutes.
4. Bring a pot of generously salted water to a boil and cook the orecchiette according to the box’s instructions, usually 9 to 11 minutes or al dente. Drain and add back to the pot.
5. Add the contents of the sheet pan into the pasta pot and toss with the Pecorino Romano. Salt and pepper to taste. ⁷

Stay safe!

Footnotes and Sources

^{1. The Wall Street Journal, October 1, 2021}

^{2. CNBC.com, September 28, 2021}

^{3. APNews.com, September 29, 2021}

^{4. Howardcm.com, September 29, 2021}

^{5.  IRS.gov, June 10, 2020}

^{6. Formstack.com, January 23, 2020}

^{7. Food52.com, March 24, 2021}

^{Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost.}

^{The forecasts or forward-looking statements are based on assumptions, may not materialize, and are subject to revision without notice.}

^{This content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. Please consult legal or tax professionals for specific information regarding your individual situation. This material was developed and produced by FMG Suite to provide information on a topic that may be of interest. FMG is not affiliated with the named representative, financial professional, Registered Investment Advisor, Broker-Dealer, nor state- or SEC-registered investment advisory firm. The opinions expressed and material provided are for general information, and they should not be considered a solicitation for the purchase or sale of any security.}

^{Copyright 2021 FMG Suite.}

McCarthy Financial Group's Blog: Market Insights & Wealth Watch