FRS ADVISORS SEPTEMBER NEWSLETTER
FRS Advisors Newsletter – September 2025
As summer winds down and we all brace for the busy start of fall—with back to school, kids’ sports, and renewed routines—the financial world remains focused primarily on the Federal Reserve (Fed).
At last month’s Jackson Hole Economic Symposium, Fed Chair Jerome Powell signaled that the Fed seems ready to cut interest rates later this month amid a slowing labor market and inflation risks poised to recede. Markets responded with a small cap-led rally and lower Treasury yields. The 10-year Treasury yield stands a good chance of staying in its current range, despite intensifying political pressure on the central bank. Containing long-term interest rates is critical as interest costs for the federal government continue to rise.
The latest inflation data for July matched expectations. However, the slight increase in the year-over-year core personal consumption expenditures (PCE) deflator—the Fed’s preferred inflation metric—from 2.8% in June to 2.9% in July reminded us that there is still work to be done on inflation. Tariffs won’t make that work any easier as they flow through with a lag, their legality notwithstanding.
At the same time, the Fed and markets agree that recession risks remain low and that corporate America is in excellent health. Second quarter gross domestic product (GDP) was revised higher to 3.3% annualized, a solid jumping-off point for the second half. Fiscal policy stimulus coming in 2026 will likely offset tariff hits to the economy, creating a favorable backdrop. Since markets are forward-looking, this setup may help stocks hold recent gains and mitigate potential market declines if volatility picks up.
Meanwhile, corporate earnings continue to impress. The “Magnificent Seven” tech giants delivered nearly 30% earnings growth in the second quarter and increased capital investment plans. Capital investment in artificial intelligence (AI) could approach $500 billion next year, and potentially reach $3 to $4 trillion by 2030, according to NVIDIA CEO Jensen Huang. This investment strengthens the earnings outlook for the tech sector and, more broadly, could bring sizable productivity gains to corporate America. Growth stocks should continue to do well.
Risks may be manageable, but we must note that September has historically been the worst month for the stock market. The average S&P 500 September price change is -0.7% since 1950. While this month could live up to its reputation as a soft patch for stocks, history shows that when the broader market is trending higher heading into September, seasonal weakness is often less of a factor.
There is also some risk that markets will react negatively to the effects of tariffs, especially with stock valuations already elevated. As we navigate these crosscurrents, we encourage investors to remain diversified and consider adding equities on potential dips. Monetary and trade policy shifts, political dynamics, and corporate earnings strength all present both opportunities and risks.
We remain committed to guiding you through these complexities with clarity and confidence. We hope summer 2025 treated you well. As always, please contact me with any questions.
FRS Advisors Updates
Lastly, we are excited to share some updates here at FRS Advisors.
- Our redesigned website, frsadvisors.com, now highlights our two core areas of work: institutional-grade retirement plans and private wealth/financial planning—all with a fresh new look.
- We’re proud to introduce our proprietary ClearPath Plan™, which makes growing and investing wealth crystal clear by guiding clients through the three pillars of FRS: Financial Planning, Retirement Planning, and Succession Planning.
- We’ve also launched our new Facebook page, FRS Boardroom, where successful business owners can find clarity and confidence in their financial future. Each week, we’ll share market insights, practical strategies, retirement and succession planning tips, and podcast-style conversations with Bob and industry experts