The stock market hit new all-time highs this week, and yet we got nothing but bad news.
Usually, that’s not a good thing because eventually the bad news and the market catch up with each other.
The first piece of bad news was GDP.
GDP was revised down from 2.0% to 1.6%.
Corporate profits have also slowed sharply.
Corporate profits came in at $40 billion in the first quarter versus $247 billion in the prior quarter.
That’s a dramatic slowdown.
The second piece of bad news was inflation.
The Fed’s preferred inflation measure, Core PCE, just hit a three-year high.
If you put slowing growth together with rising inflation, we get stagflation.
Stagflation is one of the worst things that can happen to an economy.
If inflation is rising while the economy is slowing, the Fed has a real problem.
If they raise interest rates to fight inflation, they could slow the economy even more.
If they lower rates to help the economy, inflation could get worse.
There’s no easy answer.
So why did the market hit new highs anyway?
One reason is the constant talk of a ceasefire in the Strait of Hormuz.
Every other day it seems like we hear a deal is coming.
The second reason is that AI mania came roaring back.
Snowflake reported earnings and its stock jumped 36.5% in a single day.
Investors are once again betting heavily on AI.
Here’s the part that concerns us.
There are reports of retirees with paid-off homes taking out mortgages to buy technology stocks because they don’t want to miss out.
We’ve seen that movie before.
People were doing the same thing during the dot-com boom.
None of this is intended to scare you.
If this turns into Y2K all over again and we get a major bear market, we have our Invest and Protect Process designed to help protect your retirement from catastrophic losses.
Our goal is simple: help your money last as long as you do.
We want you to go out and enjoy your Second Childhood Without Parental Supervision.
Let us get the gray hair for you so you don’t have to.
Transcript:
Hello, everyone, and welcome back to our weekly Market Alert video for today, which is may 29 2026 I hope this video is finding you healthy, wealthy, and wise, and I know it is, because you are a client of rpoa. That’s why, and not only that, I want to say a shout out to all you SCWPerS out there. I hope you guys are enjoying your second childhood without parental supervision. Go play, have fun. Let us get the gray hair for you, so that you don’t have to. We have a lot to talk about. So, I got three things that are all wrapped around new market highs. Okay, so the stock market hit new all-time highs this week, and yet we got nothing but bad news, that’s usually not a good thing, because eventually the bad news and the market catch up with each other, and so we’re going to talk about that, but so we got three things that happened. First of all, GDP, our growth of our economy, all our goods and services, and all that was revised down, so the economy is slowing. Number two, inflation hit a three year high, so the economy’s slowing. Inflation’s rising. You know what that’s called, Alex? Do you have any clue?
Not a clue.
It’s called stagflation. Stagflation is a very nasty word. We do not want stagflation. Stagflation is like the economy just got cancer and it’s really bad, so, but the market hit new highs anyway, so we’re gonna talk about all of that and tie it all together for you, but before we do, I got to say something, and you know, I’m a very shy, introverted person, and far be it from me to expand upon my wonderfulness, but there’s an old expression that says if you don’t toot your own horn, ain’t nobody gonna do it for you. So we just hit Alex, our fearless forecast for the year. You know, at the beginning of this year we had our fearless forecast show, and I said that the S&P, the stock market, would reach 7500 and it did. And so I have a very special guest that I didn’t tell you about. I snuck, I snuck this guest into this, into the showroom. So I’m gonna bring him up here. This is my, my, my special guest, and he’s my, my buddy, he’s my crystal ball. And so I every year I talk to my crystal ball, and I say, crystal ball, by the way, I haven’t figured out how to turn this on yet, you know, it’s like there’s no on switch for this thing, it doesn’t come with an on switch, but yeah, so yeah, every year at the beginning of the year I look into the crystal ball and I ask it, what do you think is going to happen, and you know we’ve been remarkably accurate, and over the years I think in all of the fearless forecast that we’ve done, I think we’ve done probably 15 or 16 over the last 20 some years, and I think the only one that we missed was back in 2005 and it was a bad miss, but other than that, we’ve been right on. And by the way, the fearless forecast is always not what the end of the year is, what’s the high for the year? So this could be the high, so anyway, let’s talk about what happened. So first of all, the GDP, which, as I said, it’s a gross domestic product. This is how we measure the output of our entire economy. It’s
been revised down. The first estimate was that it was 2% It’s been revised down to 1.6% That is a meaningful downgrade. Okay, just for context, in Q4 of last year, our GDP grew by half a percent, so we’ve gone from half a percent to 1.6% So we’re still growing, but they’re reducing it. Corporate profits have also slowed sharply. Here’s a stat for you: 40 billion in Q1 versus 247 billion the prior quarter. Did you hear what I just said? 40 billion versus 247 billion. Corporate profits are slowing down dramatically. So that’s one thing. And you wonder, well, why did the market hit new all-time highs? So we got another thing that happened: inflation just hit a three year high. So there’s a number that the Federal Reserve uses, which is they call it the core CPE, okay? So they take food out, they take energy out, and they look at what are the trends in the underlying economy in terms of inflation, and guess what, it hit a three year high. That’s not a good thing, that’s a bad thing, right? But yet market new all-time highs, so if you put those two together, the definition of that, if it becomes an entrenched thing, is stagflation, and stagflation is the single worst thing that can happen to our economy. It is what has driven many economies around the world in history into second or third rate countries. It’s what it’s what can do that, because if you have inflation at the same time as a slowing economy, what does the Fed do? The Fed normally, if you have inflation, they raise interest rates, right, to slow the economy down, but if the economy is already slowing down and they raise interest rates, they’re going to put us in a depression. On the other hand, if they raise interest rates to fight inflation, then what happens is the economy slows down, so it’s like they can’t.. there’s no answer to this, you almost have to just let it play itself out, and it feeds on itself. So, we don’t want stagflation. So, why did the market rally anyway? Well, two reasons. One is every other day we hear there’s a cease fire in Hormuz. I’m starting to wonder. It’s like every other day President Trump comes out and says, okay, we got a cease fire, we got to do that, we’re going to sign a deal, and then next thing you know, there are missiles flying onto the Strait of Hormuz, so maybe there’s no deal happening, I don’t know, but for now it appears we have a ceasefire, that was one thing, and then of course AI mania came back strong last week, we had Snowflake, which is a technology company. They report their earnings, and their stock price jumped. Are you sitting down 36 and a half percent in a single day. So people, and you know, here’s what the scary part of all this is for me. Also, I read an article where retired people who have paid off their mortgages are actually mortgaging their homes to buy technology stocks, because you know they don’t want to miss out. That I’ve seen that movie before, ladies and gentlemen. That was y2k people were doing that to buy the dot coms. So all of this is not to scare you, dear client and dear SCWPer. It’s hopefully to give you peace of mind, because we have our invest and protect process, so if this does turn into y2k all over again, where there’s this massive sell off, the stock market goes down 49% If all of that happens, then we’re very confident that our invest and protect process will be there to help us to mitigate that downside and hopefully keep you from experiencing
catastrophic losses, so I know it gives me peace of mind, because you know it’s my job is to take care of you and make sure that you know you, your money lasts as long as you do, and I feel very confident that we’ll be able to do that for you if the worst is going, it happens now, hopefully it won’t, and all this will be nothing, but remember my crystal ball, right, you ignore it at your own peril, so that’s all I got for you this week. Thank you for watching. I hope this was informative. I hope you feel good. I hope all of you are enjoying your second childhood out there that are so inclined, and we’ll talk soon.
Economic indicators and stock market performance cannot be predicted. Opinions expressed regarding the economy and the stock market belong solely to employees of RPOA on behalf of Retirement Planners of America and may not accurately portray actual future performance of the economy or stock market outcomes. Opinions expressed in this video is intended to be for informational purposes only and is not intended to be used as investment advice for individuals who are not clients of Retirement Planners of America. All content provided is the opinion of employees of RPOA Advisors, Inc. (d/b/a Retirement Planners of America ) (“Retirement Planners of America”, “RPOA”). ©Copyright 2026