By Paul Levin, CFP®, ChFC®, RICP®
The news that the US will impose additional 100% tariffs on China beginning November 1 sent the markets into a tailspin last Friday. This, on top of the government shutdown, a weakening labor market, elevated stock prices, and the fact that “real” costs have not stopped rising aggressively, has many investors on alert.
Should we be concerned? The short answer is, of course! How long can corporate profits continue driving the markets higher? Profits are the most important input for stocks; however, if the other issues are not dealt with soon and in a favorable manner, we may see the top 10% of consumers who contribute 50% of consumer spending starting to pull back.
Last Week’s Market Performance
For the week, stock indexes fell:
- Dow Jones Industrial Average: (2.25%)
- S&P 500: (1.54%)
- Nasdaq Composite: (1.65%)
- Russell 2000: (2.27%)
- Foreign Stocks: (2.74%)
- Emerging Markets: (3.76%)
Bonds were the haven for the week, as the 10-year US Treasury ended the week with a yield down to 4.059%.
Tariffs and Inflation
Tariffs were supposed to be a one-time hit to prices. It does not feel that way. Yes, gasoline prices have remained steady, and we are thankful. Food prices, furniture, travel, and other expenses seem to keep rising.
Re-onshoring large sectors of manufacturing after the intense offshoring efforts of the 1970s–1990s will be challenging. We are now paying the price for our prior decisions, such as the loss of domestic expertise and weakened supply chains. These consequences have made it more difficult to quickly ramp up production, ensure product quality, and respond to disruptions. Let’s hope our unknown outcome will be a positive one.
Q3 Corporate Earnings Season
This week kicks off Q3 earnings season. We’ll hear reports from JP Morgan, Johnson & Johnson, Goldman Sachs, Wells Fargo, Citigroup, BlackRock, Abbott Labs, United Airlines, and more.
Will earnings reports reverse last week’s negative stock index performance? This profit season will be telling, particularly among non-AI companies.
Don’t count out corporate America’s ability to adapt, even in challenging conditions. Even when conditions turn challenging, corporations tend to find ways to protect profits.
Government Shutdown Update
As of this writing on Sunday morning, there is no ending in sight for the shutdown. Both sides appear to be digging in, again suggesting political power is more important than people and country.
The main issue, at least on the surface, continues to be the Affordable Care Act’s additional subsidies set to expire December 31, 2025. Currently there is no income limit for receiving a subsidy. Yes, no income limit. However, to receive a subsidy, your premium must be greater than 8.5% of your income.
The original subsidy is based on the poverty level. You receive a subsidy if your income is less than 400% of the poverty level. Poverty levels are quite low, and the fact that health insurance premiums have risen significantly more than inflation over the years suggests that the system needs to be rethought and restructured.
I would like to see our government use this as an opportunity to revisit healthcare and health insurance. The current level of price increases is simply unsustainable for our economy.
The shutdown is also limiting government reports that are necessary for investors and the Fed. This week, we were supposed to receive the September CPI report. The CPI release has been postponed and will now be released on October 24th. We need this key number to determine the Social Security Cost of Living Adjustment (COLA) for 2026.
Medicare Open Enrollment
October 15th through December 7th marks Medicare’s open enrollment period. During this time, you can change your Part D prescription drug coverage, switch from Medicare Advantage to Original Medicare, or switch from Original to Advantage. Your new coverage will go into effect January 1.
If you switch from Medicare Advantage to Original Medicare, keep in mind you will need to purchase a separate Part D drug plan and a Medicare Supplement. Purchasing a Medicare Supplement can be a challenge if your health has deteriorated, as you will have to prove you are insurable. However, if you are within the first 12 months of originally joining a Medicare Advantage plan, you will typically be able to switch without medical questions. In addition, if your Medicare Advantage plan terminates its coverage, you may be able to obtain a guaranteed issue Supplement.
The government shutdown is not supposed to impact your ability to research and change coverages. I would not be surprised to see a little delay in companies posting their information. I would suggest waiting a couple of weeks before going onto the Medicare plan finder site to research your options.
You can find your coverage options at Medicare.gov.
Final Thoughts
Between tariffs, the shutdown, and earnings, the next few weeks will likely set tone for year-end market direction, income planning, and risk management across retirement portfolios. Staying patient, diversified, and aligned to specific income needs remains essential, especially with interest rates, inflation, ever-changing government policy.
Thank you for reading, and please consider sharing the Weekly Retirement Blog with friends, family, and colleagues who may benefit from staying informed.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.
All market data sourced from The Wall Street Journal, October 10, 2025.
