A Gameplan for Initial Public Offerings
September 1, 2026
By Brett Freese
The 3rd quarter of 2026: Concerns, opportunities, football, and baseball
Fall is in the air. Football season has just started, and my favorite team’s (NY Giants) starting QB (Jaxson Dart) is out for the season, and baseball playoffs have begun. A Major League Baseball team plays 162 games during the regular season, and based on their records, they make or miss the playoffs. A team might have won the most games during the regular season and might have the best team on paper, but if they lack momentum and energy, they could quite easily lose in the first round of the playoffs to a lesser team on paper that is playing healthy and with confidence. The financial markets feel like we are in the playoffs every day and that today’s ups and downs make or break our year. The current market conditions do matter, and we need to be strategic, but successful investing is more about decades of winning “regular season” games.
Economic & Investment Highlights
- The Federal Reserve rate hike and possible future hikes to stem inflation: The New Fed Chairman, Kevin Warsh, is tasked with understanding and responding to ongoing economic data and expectations. He and the other members of the Federal Open Market Committee (FOMC) face uncertainty and sometimes conflicting economic indicators. On September 16th, the committee implemented an increase in its benchmark interest rate to the 3.75% to 4.00% range as a response to inflation, maintaining a higher rate than the 2% annual goal. Further rate increases are expected by the financial markets. As a reminder, the Federal Reserve has a dual mandate to achieve both stable prices and maximum sustainable employment.
- Fixed Income Market: The Fixed Income Market moved towards higher yields in longer-term maturities, with the 10-year US Treasury yield climbing just over 5.30% on September 30th (highest rate in 24 years). Note: The highest recorded 10-year Treasury yield was 15.84% in September of 1981 before Paul Volcker and the Fed implemented a dramatic economic intervention known as the “Volcker Shock.” We are nowhere near the need for that kind of intervention. We are currently in a historical “normal range.” It just feels extremely high because we have gone two decades with very low interest rates.
- Mid-Term Elections: Politics! Books can be written about the history of Mid-Term Elections in regard to expectations, results, and market reactions. Generally, (“good” or “bad” in light of one’s political bent) the financial markets tend to be content with Mid-Term Election results that bring some movement towards a “balance of power.” This one will be no different, with the Democratic Party likely gaining leadership in the House and maybe even the Senate. Note: Impact will be felt, but as with politics, the focus will quickly turn to the 2028 election of our next President, 100% of our House of Representatives, and 1/3 of our Senators.
- Artificial Intelligence (AI) Concerns and opportunities and Data Center Buildouts: Trillions are being spent on chips, and investing in heavy data center construction is currently adding to US short-term inflation, with a long-term promise of gains in labor productivity and economic efficiency. AI is front and center in politics as well, with Data center building “not in my backyard,” a shortfall in energy production, and concerns about a possible lack of control and containment of AI. Labor disruption is coming, but where and how fast is up for debate, as well as labor opportunities. Where robotics displaces more blue-collar jobs, AI displacement is affecting the white-collar labor force more.
- IRAN Conflict Continues: We have seen escalation and de-escalation continue to flip back and forth, tolls and blockades in the Strait of Hormuz, peace discussions and negotiations, and little confidence that a deal will be made and/or kept.
- Oil and Energy Shock Consequences: These geopolitical challenges have sent global energy prices upward, with Brent crude hovering around $90 per barrel at the end of September due to supply concerns and daily unknowns.
- Initial Public Offering update on SpaceX: On June 12, SpaceX debuted at a massive valuation of just under $2 trillion. The opening price per share was $150; it closed on September 30th at $150.24 per share and had a trading high of $225.64 and a low of $104.83. IPOs are exciting, but here is another example of early IPOs with no real gains.
Historical Stock Market Declines
Market declines and inclines rarely look the same or even feel the same, but they do happen, and the ups and downs are a part of the process. It is important to have a plan/strategy so emotions don’t dictate buying or selling.
A 5% or greater loss occurs about 3 times a year
A 10% or greater loss occurs about once a year
A 15% or greater loss occurs about once every 2 years
A 20% or greater loss occurs about once every 3.5 years
Please know that when stock prices go down, the “market collapse gurus” receive the most airtime. Likewise, when stock prices go up, all the “bull market gurus” talk about how the market will continue to be up BIG. Most “gurus” are great at using hindsight to justify why their voice should be heard.
Market Scorecard for the last 13 weeks ending 9/30/2026
US Equities:
+ 2.30% S&P 500 (Index of the largest US publicly traded companies)
+ 1.19% Large Cap Growth – Morningstar Category
+ 0.59% Large Cap Value – Morningstar Category
– 9.39% Russell 2000 Growth (Index of Small-cap growth US publicly traded companies)
– 4.91% Russell 2000 Value (Index of Small-cap value US publicly traded companies)
International Equities:
– 3.13% Foreign Large Growth – Morningstar Category
+ 2.30% Foreign Large Value – Morningstar Category
– 0.49% Foreign Small/Mid Growth – Morningstar Category
+ 5.82% Foreign Small/Mid Value – Morningstar Category
Bonds:
– 3.04% U.S. Aggregate Bond (Index representing intermediate-term investment-grade bonds in the U.S.)
– 3.76% Corporate Bond – Morningstar Category
– 0.58% Short Government – Morningstar Category
– 5.34% Muni National Bond Intermediate Index – Morningstar Category
Other:
+ 3.15% Gold Price
+ 42.31% Bitcoin
+ 14.58% Commodity Broad Basket – Morningstar Category
Current Annual Money Market Rates ending 09/30/2026
3.71% Schwab Value Money Market
3.53% Schwab Treasury Money Market
Market Indicators
Inflation:
3.4% as of August 2026 (down 0.80% from 4.2% in May 2026)
Unemployment:
4.1% as of August 2026 (down 0.2% from 4.3% in May 2026)
Fed Funds Target Rate:
3.750% – 4.00% as of September 2026 (up 0.25 from 06/25/26)
Suggested Next Steps
- Understand that market cycles are normal. The markets go up and down in mostly unpredictable directions and amounts. Many times, the ups and downs of investments seem to make sense only after they happen; however, market prediction is very difficult. (i.e., the next stock market crash has been predicted every year since 2008).
- Your investments are just one factor in the success of your life, money, and purpose. Make sure that you are confident in your full financial plan, so you can successfully have an amazing ROL (Return on Life).
- Your investment allocation and diversification are important factors in both risk management and future returns. Therefore, if you have questions about your investment plan, please schedule a phone or in-person meeting with your TrustWell Financial Advisor(s).
