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October 1, 2023

Dear Client: Returns for the major stock indexes in 2023 and the current bond and money market yields are as follows: Index     YTD 2023 Dow Jones Industrial Average       1.09% S&P 500     11.68%   Fixed Income Yields     1 year 2 year 5 year 10 year 30 year Municipals 3.73% 3.65% 3.38% 3.44% 4.42% US Treasuries 5.45% 5.04% 4.61% 4.57% 4.70%   Fidelity Government Cash Reserves Money Market Fund 5.11% Fidelity Money Market Fund Class Premium 5.31%   Despite a solid first-half performance, the markets have recently stagnated.  Overall, the year-to-date performance of the S&P 500 has been respectable, but as highlighted in our 2nd quarter letter, its performance has been dominated by the outsized weightings of just a handful of the index’s largest companies.  The average stock, however, has not performed in 2023, as the equal-weighted S&P 500 index and Dow Jones Industrial Average are flat on the year.  The S&P 500 is trading in line with June of 2021, while the mid and small-cap indexes have traded sideways for nearly three years.  The value indexes have had the best relative performance since the last market high in December 2021 but are still flat after almost two years.  Clearly, the last few years have not been a rewarding time to be an equity investor. The bond market has performed worse.  For the first time, the bond market is on pace to be down three years in a row and is currently in its largest drawdown in history.  The 40-year run of continually lowering interest rates is over, as the 10-year Treasury rate now sits at a...