America is in the midst of an economic reset – one that’s creating genuine opportunities for investors who understand what’s actually happening beneath the headlines.

Accountability spotlight drives confidence

The Department of Government Efficiency put a spotlight on federal spending accountability in ways we haven’t seen in decades. Whether DOGE’s reforms last permanently matters less than the conversation it has started. Markets are responding to this newfound focus on fiscal responsibility, and that shift in expectations is real. 

Oil prices ease inflation pressure

Energy costs are falling, with oil prices down significantly from 2024 levels. This takes direct pressure off inflation numbers. April’s 2.3% CPI reading reflected this energy deflation, and there is more to come as transportation and production costs continue to moderate.  While we believe oil prices could rise in the near term due to Middle East conflict considerations, we stand by our forecast of lower oil prices as the year progresses.

Tariffs manageable while improving fiscal picture

Despite predictions of economic chaos, tariff impacts are proving more muted than expected. Businesses adapt, supply chains adjust, and markets find equilibrium. Meanwhile, the revenue contribution helps bring the federal budget closer to sustainability, addressing a core structural problem that has worried investors for years.

Deregulation unleashes productivity

The administration’s aggressive deregulation agenda represents the most significant productivity enhancement program in decades. From nuclear licensing reform to financial regulation streamlining, these changes remove real barriers to business investment and economic growth.

Fed provides liquidity without fanfare

While holding rates steady, the Federal Reserve has implemented substantial accommodation through balance sheet management. This “stealth easing” supports markets and maintains liquidity without compromising the Fed’s inflation credibility.

Markets volatile but trajectory clear

Seasoned investors know that major economic shifts lead to market instability. Volatility will likely continue through the summer, with potential corrections to 5,200-5,300 on the S&P 500.

However, fundamentals remain strong. We’re seeing earnings growth projections of 11%, solid GDP progress, and major investment banks expecting an S&P of 6,500 by the end of the year.

The bottom line

We’re witnessing an economic realignment marked by accountability in government spending, lower energy costs, manageable trade adjustments, reduced regulatory burdens, and supportive Fed policy. Near-term volatility creates opportunity for positioned investors. The trajectory through Q4 2025 points toward renewed American economic strength.

At DCA Asset Management, we remain committed to our Active Capital approach – providing strategic guidance through changing conditions while positioning clients for the opportunities this reset creates.

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*One of DCA’s guiding principles is that we will communicate with our investors and prospective investors as candidly as possible because we believe investors and prospective investors benefit from understanding our investment philosophy and approach. Our views and opinions regarding the prospects of investments and/or the economy are forward looking statements as defined under the U.S. federal securities laws, which may or may not be accurate and may be materially different over future periods. Generally, the words “believe,” “expect,” “intend,” “estimate,” “anticipate,” “project,” “will,” “may,” “should,” “plan,” or the negative of such terms and similar expressions identify forward looking statements. Forward looking statements are subject to certain risks and uncertainties that could cause actual results to materially differ from an investor’s historical experience and current expectations or projections indicated in any forward looking statements. These risks include, but are not limited to, equity securities risk, corporate bonds risk, credit risk, interest rate risk, leverage and borrowing risk, additional risks of certain investments, management risk, and other risks. We disclaim any obligation to update or alter any forward looking statements, whether as a result of new information, future events, or otherwise. You should not place undue reliance on forward looking statements, which speak only as of the date they are made.