In the January 2009 Webb Financial Group newsletter, I wrote an article addressing the last time the US was worried about bank failures. Here is how the article started, “We understand that these are stressful times, with the economy in a recession and markets down dramatically. Workers are worried about job security, and those in retirement are fearful about financial security. Many families have cut back their spending. There haven’t been many positives in the economy in the last six months; however I feel this will improve. Historically, the markets have followed a cycle. I strongly believe the cycle will change and begin to work its way upward.”
 

What we are seeing now is nothing close to the performance of the 2009 economy despite what is reported by the media. In fact, it’s the mirror opposite. The Federal Reserve is trying to prevent inflation by raising interest rates to slow consumer spending. We are likely already in a minor recession but won’t know until the end of the year. This is where the story is different now. Very few people are worried about job security since the unemployment rate is low and most businesses are hiring because they don’t have enough employees. The 2009 unemployment rate peaked above 10% but currently we’re only in the mid 3%. At present, families are
not cutting back on their spending. In fact, they are spending more than at any time in the past three years. There is no shortage of business at restaurants,
car dealerships or the airport. I can’t believe the price of a vacation for a flight, hotel and car rental, which costs a small fortune and yet no one is staying home. We strongly expect the cycle will begin to work its way upward this year.

In March, we saw a volatile ride for both the stock and bond markets as the news of the Silicon Valley Bank failure was digested, the subsequent response by the government and concerns regarding several other banks. To support businesses and households, the Federal Reserve Board announced it will make additional funding available to eligible depository institutions to help assure banks have the ability to meet the needs of all their depositors. This action will