Month: March 2026

The primary concern and biggest navigational deterrent for winter mountaineers is generally a high wind speed. At 70 MPH it becomes questionable as to whether the climber or the wind is in control, at 80 MPH all doubt is removed, and at 100+ MPH the climber is “belly down” and crawling for survival with plummeting prospects for success. It’s notable that other climber “concerns”, like flying snow and ice, physical weakness, and plunging core temperatures are usually direct implications of high winds. Inflation is one of the most influential factors with an equivalent influence over the global economy and asset prices. The early indication is that the 20% reduction in global oil shipments caused by the closing of the Strait of Hormuz may cause higher oil prices to persist into the second half of this year, which may directly impact price inflation economy wide.

Consider the implications of rising inflation:

• Higher interest rates: Central banks (like the Federal Reserve) often raise rates to fight inflation, increasing borrowing costs for businesses and consumers. This reduces investment, hiring, and spending—dragging down economic activity and stock valuations.
• Lower corporate profits: Rising input costs (wages, materials, energy) squeeze profit margins, especially if companies can’t fully pass costs on to customers.
• Reduced consumer purchasing power: Inflation erodes real incomes, so households buy less, weakening demand for goods and services.
• Valuation compression: Higher inflation and rates increase discount rates used in stock valuation models, lowering the present value of future earnings—especially hurting growth stocks.
• Increased uncertainty: Volatile inflation makes it harder for businesses to plan pricing, investment, and expansion, often leading to delayed decisions and slower growth.
• Weaker consumer and business confidence: Persistent inflation can reduce confidence, causing more cautious spending and investment behavior.
• Debt burden stress: Higher rates tied to inflation increase interest payments for companies and households with variable or new debt, raising default risks.
• Currency instability: Inflation can weaken a country’s currency, increasing import costs and creating additional economic strain.
• Policy tightening risk: Aggressive anti-inflation policies can overshoot, potentially triggering recessions or financial market disruptions.

Also consider how the following strategies may help you oppose “belly down” levels of monetary destruction caused by insidious inflation:

• Reprioritize essentials in your budget, like housing, groceries and insurance, while pulling back on discretionary spending, like subscriptions, dining out, impulse spending, and vacationing.
• Reprioritize present income, like work-based compensation, negotiating a raise, increasing specialization in high demand areas, and interest and dividends on invested capital. Understand inflation tends to prioritize a dollar today (dividends) over the promise of a dollar tomorrow (growth).
• Shore up the emergency fund to the equivalent of 6-9 months of total annual household spending and place it in a high yield savings account or Treasury Money Market account.
• Invest in assets that have a built-in inflation protection, like Treasury Inflation-Protected Securities (TIPS), and that have historically performed well during periods of high inflation, like Real Estate and other Real Assets.
• Manage debt as you might a pet scorpion: cage it, starve it, and if it hisses at you, exterminate it! Avoid consumer debt, high interest variable debt, and lock in a lower fixed interest rate before inflation raises rates.
• Manage the timing of spending thoughtfully by pre-purchasing durable goods, while delaying discretionary items that may drop in price later.

Battle inflation as you would a 100+ MPH wind at 14,000 feet, get to the work at hand, and may God bless your inflation-fighting efforts! Shaun

“He who earns wages does so to put them into a bag with holes” ~Haggai 1:6

“A quart of wheat or three quarts of barley will cost a full day’s pay” ~Revelation 6:6

Disclosure

This material is provided for informational purposes only and reflects the views of the author as of the date of publication. It is not intended as investment advice or a recommendation to buy or sell any security.

All market and economic commentary is based on current conditions and expectations, which are subject to change. Forward-looking statements are inherently uncertain, and actual outcomes may differ materially from those expressed or implied.

Investing involves risk, including the potential loss of principal. Past performance is not indicative of future results.

References to specific asset classes or investment strategies are for illustrative purposes only and may not be suitable for all investors. This content does not take into account any individual’s financial situation, objectives, or risk tolerance. You should consult your financial advisor before making any investment decisions.

Old Forge Wealth Management, LLC is a registered investment adviser. Registration does not imply a certain level of skill or training.

As my climbing buddy and I emerged from the safety of the below-treeline windshield, we were harshly greeted by 80 MPH winds hurling tiny ice particles straight into our unprotected eyes, preventing even a peak in the direction we hoped to advance! A quick retreat to “goggle up” allowed us to get through the “flying-ice wind tunnel”, but trouble on the descent hours later affirmed we should have listened more intently to the mountain’s early warning that day. While concerning developments relating to the Iran War are not a cause to blindly sell stocks and other risky assets, they are warnings to be observed and weighed in our quest to remain mindful of Warren Buffett’s well-known principle to prioritize avoiding permanent loss of capital. Consider the uncertainties the Iran Conflict presents to the investing landscape:

The Context

• In the last 150 years stock valuations¹ have been higher than today four times, all of which were brief excursions.² The context is that stocks are expensive today.
• The 2/10 Yield Curve, regarded by many to be amongst the most reliable recession indicators, was deeply inverted for over two years and turned positive just 18 months ago.³ This is well within the boundary of time in this historical relationship,⁴ and it would be highly unusual if such an inversion is not followed by recession.
• Priced into today’s stock valuations is the expectation of two more rate cuts this year, nearly mandated by President Trump. Were that not to happen, a revaluation of equities would likely occur.
• Today’s global economy runs on two essential things: debt and energy. A lasting disruption in either of these will likely lead to recession, or worse.

Iran Conflict-Related Developments

• A significant reduction in global oil shipments due to Iran bombing tankers passing through the Strait of Hormuz has introduced an energy supply shock. Refineries in the region are shutting down, and due to the time required to resume operations the resulting spike in oil prices may last long enough to invigorate inflation in the second half of 2026.⁵
• Rising inflation means the Fed may either follow through on its promise to cut rates and repeat the 2021 error of unintentionally stoking already warm inflation, or disappoint the market by not cutting rates. Either scenario could create headwinds for stock prices
• There is trouble brewing in the credit market as a (so far) quiet ‘run’ takes place in the Private Credit and Equity markets due to illiquidity concerns. Redemption requests amongst Non-Traded Business Development Companies surged over 5-fold in Q1 (over Q1 2025), and Blackrock, the world’s largest asset manager, is limiting redemptions. Stansberry Research reports that “concerns about private credit are starting to trickle into the broader credit market”.⁶

A supply shock in energy coupled with a disruption in the credit (debt) market as inflation threats emerge and while stocks are priced to perfection, is a setup that should have our attention. Use your tools, not your emotions to navigate the terrain. Think about it, and may God bless your asset protection efforts!

Shaun

“The prudent sees danger and hides himself, but the simple go on and suffer for it” ~Proverbs 22:3

“Rule #1 is, NEVER LOSE MONEY; Rule #2 is, NEVER FORGET RULE #1” ~Warren Buffet

1 As measured by the average price to earnings (P/E) ratio of the S&P 500 Index

2 LT Charts, S&P 500 P/E Ratio, December 1870 – November 2025

https://www.longtermtrends.com/sp500-price-earnings-shiller-pe-ratio/

3 Y Charts, “10-2 Year Treasury Yield Spread”, 5 Year Chart

https://ycharts.com/indicators/10_2_year_treasury_yield_spread

4 Brighton Jones, “Time to Worry? What an Inverted Yield Curve Does and Doesn’t Mean”, March 27, 2019

https://www.brightonjones.com/blog/inverted-yield-curve/

5 Presentation at FPA Luncheon, March 11, 2026, Harbor Capital

6 Stansberry Research, The Stansberry Digest, “A Rush for the Exits has Begun”, March 10, 2026

Disclosures

Old Forge Wealth Management, LLC is a Rhode Island registered investment adviser. Registration with a regulatory authority does not imply a certain level of skill or training. Additional information about Old Forge Wealth Management, LLC is available in its Form ADV Part 2A, which is available upon request or through the SEC’s Investment Adviser Public Disclosure website at www.adviserinfo.sec.gov.

This commentary is provided for informational and educational purposes only and is not intended as investment advice or a recommendation to buy or sell any security or adopt any particular investment strategy. The views expressed are those of the author as of the date of publication and are subject to change without notice.

This material is not intended to provide a complete analysis of every material fact regarding any country, region, market, industry, security, or investment strategy. Forward-looking statements, opinions, and estimates are based on current market conditions and assumptions and are subject to change. Actual market conditions and outcomes may differ materially from those expressed.

Past performance is not indicative of future results. Investing involves risk, including the potential loss of principal. This material is intended for a broad audience and may not be suitable for all investors.

It fascinates me that in the deadliest (1967) expedition in Denali’s history, five of the seven climbers who perished chose to cower in a snow cave and freeze to death, and two individually died trying to descend “The High One” in a raging winter blizzard alone. My profession has taught me that, fiscally speaking, there are two types of people in the world, wealth producers, who spend less than earnings and wisely invest the difference to grow income and wealth, and wealth consumers, who spend more than earnings and go heavily indebted from crisis to crisis. While the process of wealth-building should be quite straight forward, orchestrated inflation complicates the process immensely. Growing wealth after taxes in real (after inflation) terms is challenging, and asset allocation is the critical factor that separates success from apparent success (where nominal wealth grows while actual (after inflation) wealth shrinks).

When a nation can’t repay its debts on honest terms, it can honestly default, or it can dishonestly attempt to inflate its debt away by increasing the money supply, which increases reported GDP growth, which reduces the “Debt/GDP Ratio”, which presents a more ‘solvent’ financial picture. The inflation scheme is a fool’s errand because the debt never actually goes away. The reasons governments choose inflation include, a) it’s wonderful fun spending other people’s money, b) it maximizes a delay in the consequences of excessive indebtedness, c) it waters those near the spicket most abundantly, and d) it is highly deceptive and goes unnoticed by most of humanity.

Inflation also raises the question of whether we can grow our wealth after taxes faster than the government devalues the dollar. There is “nothing new under the sun”, and historically success has come with high quality capital efficient businesses, real estate, and other ‘real’ (intrinsically valuable) assets. It has notably not come with domestic currency-based fixed income holdings or income streams. Consider the following inflation-fighting principles as you strive to grow your own wealth in real terms:

• Strict budgeting with an eye on inflation will cut expenses and raise investable income. I fired two insurance companies last year which tried imposing 14% and 18% premium increases in a 2.5% CPI year, savings thousands. Buying a modest and certified, pre-owned vehicle can have an even greater positive effect on wealth-building.

• Methodically invest 15%+ of your earned income as you work hard, constantly increase specialization in your chosen field, and seek adequate compensation for your increasing value. Take great enjoyment in serving people well.

• Train yourself to get excited by crashing prices and fearful of euphoric sentiment. Studious investors thrive, but sheep starve. Don’t fight the trend but never follow the herd. Strive to consistently make wise allocation decisions with your God-given capital towards securities which have historically outperformed inflation. Invest only in things you understand.

• Manage risk prudently with an exit plan on risky holdings from the moment of purchase, position-sizing, a portfolio that reflects your risk profile and investment objective, and diversification of holdings to numerous asset classes.

I believe the two climbers who died attempting to descend the mountain had a far higher probability of survival than the five who froze in an unidentifiable snow cave positioned higher on the mountain than helicopters fly. I also believe these principles may help investors improve their chances of preserving and potentially growing wealth after taxes and inflation over time. Think about it, and may God bless your wealth-building efforts! Shaun

“Every good gift and every perfect gift is from above, coming down from the Father of lights, with whom there is no variation or shadow due to change” ~James 1:17

Disclosures

This commentary is provided for informational and educational purposes only and should not be construed as personalized investment advice. The views expressed are those of the author as of the date written and are subject to change without notice.

All investments involve risk, including the possible loss of principal. Past performance and historical trends are not indicative of future results. References to asset classes, market conditions, or investment strategies are for general discussion purposes only and may not be appropriate for all investors. Investors should consider their individual circumstances before making investment decisions.

Old Forge Wealth Management, LLC is a registered investment adviser. Registration does not imply a certain level of skill or training. Additional information about Old Forge Wealth Management, LLC, including our Form ADV Part 2A disclosure brochure, is available at www.adviserinfo.sec.gov.