The sun is shining, temperatures are rising, and the sounds of Pomp and Circumstance are in the air. It's graduation season again and, whether your graduates are finishing high school or college, you may be wondering if they are prepared with sufficient knowledge of personal financial skills to be successful. If you expected them to learn that information at school, you may be disappointed. As of May 4th of this year, only nineteen states required high school students to take a personal finance class before graduating (New York is not one of them), nor is it typically required in college.

Matching assets with liabilities is one of the prudent rules of banking. The failure to do that led to such financial crises as the Savings & Loan collapse of the 1980s and it surfaced again when a little-known, yet financially prominent California bank collapsed last month, sharply shifting economic fortunes and central bank policy.

The reigniting of inflation to its highest levels in over four decades has been the catalyst for the dramatic sell-off in stock and bond markets for the past year. Inflationary pressures began building in early 2021 as the result of several factors: revived consumer demand in the aftermath of the COVID shutdowns; supply chain disruptions from multiple sources; and the excessive monetary and fiscal stimulus from multiple COVID rescue plans implemented by the Federal Reserve and the Federal government.

After a sizzling 2021 and a roaring 4th quarter, equity markets began 2022 on a distinct down-note. Recovery from the COVID pandemic provided blue skies for two years of solid equity gains, but storm clouds were brewing on the horizon. Increased inflation caused interest rates to drift higher during the fourth quarter of 2021, and that rise began to accelerate in the new year, precipitating a sharp decline in equities, even before any official rate hikes by the Federal Reserve. Adding to the downdraft was a slump in economic activity from a resurgent COVID virus around the world, and then the onset of war in Europe as Russia invaded Ukraine. By their mid-March lows, the S&P 500 had entered correction territory with a decline of over 10%, and the NASDAQ Composite was in a bear market with a decline of more than 20% from its high.

American politics has been highly polarized for at least the past 20 years, and often the policy proposals of the two major parties have been significantly different from each other. So, it is not surprising that each side views itself as good for the economy while portraying the other as a looming disaster. With polls expected to tighten as election day draws near, many investors wonder how financial markets might respond to the various possible outcomes.

Recessions, defined by economists as negative GDP growth for two consecutive quarters, are a natural component of the business cycle and on average have happened every four years since 1900. Our current situation is different in that it is not solely driven by economic forces. The global pandemic created a sense of urgency to dramatically limit our ability to interact with each other, so what we are experiencing now can be best described not as a recession but rather an economic shutdown. This distinction may be obvious, but it is important for us to understand this as we make our way out of this unprecedented predicament.

For most of us, wealth is not an end itself, but a means to living a rewarding life – achieving personal goals, caring for family members and contributing to the larger society around us. All of this requires a vision of what we want to accomplish and how we intend to do it.