{"text":[[{"start":6.95,"text":"The writer is chief investment strategist at Charles Schwab"}],[{"start":12.15,"text":"Investors often describe the current environment as “uncertain” but that word may understate what is truly different about this cycle. Uncertainty implies a range of possible outcomes around a stable centre. What defines today’s US backdrop, and likely much of 2026, is something more persistent and at times more disruptive: “instability”."}],[{"start":38.48,"text":"Instability is not about a single looming risk (including geopolitics) or a binary outcome. It reflects an environment in which the relationships on which investors rely, between inflation and growth, labour and consumption, policy and markets, are constantly shifting. That instability, rather than a clear recessionary or boom-time signal, is a defining feature of the current cycle."}],[{"start":66.27,"text":"The message from this is not that equities are poised for collapse, nor that the path ahead is smooth. Rather, the market is navigating a regime in which stock market leadership rotates more frequently and returns are dominated by dispersion between sectors, styles and even companies within the same industry. Instability also tends to produce higher volatility, not necessarily from crises but from continual repricing of expectations."}],[{"start":95.66,"text":"Perhaps, the clearest example of instability is around inflation, which remains stubbornly above the Federal Reserve’s 2 per cent target. What began as a supply-driven shock has evolved into something more demand-orientated — and the latter has a habit of lingering. Trade policy adds another layer of instability. Now embedded in the policy framework, higher tariffs act less like one-off price increases and more like permanent step-ups in the cost structure of the economy. That matters for profit margins, consumer prices and, ultimately, monetary policy."}],[{"start":134.4,"text":"Complicating matters further is the growing scepticism around the inflation data itself. Methodological changes and a rising share of imputed prices in inflation reports may not materially distort the trend, but they do affect confidence among households, investors and policymakers alike. Perception matters, especially when inflation psychology is already fragile."}],[{"start":162.3,"text":"The labour market tells a similarly uneven story. Headline employment growth has remained positive, yet beneath the surface there are clear divergences. Large firms continue to hire, while smaller businesses show increasing caution. Wage growth supports consumption, but affordability pressures, from housing to everyday necessities, are increasingly visible."}],[{"start":188.63,"text":"These bifurcations matter because they challenge simple narratives. The US economy is not uniformly strong, nor is it uniformly weak. It is uneven, and uneven economies tend to produce uneven market outcomes. For the Fed, this creates an uncomfortable policy path: tighten too much and risk hurting weaker segments of the economy; ease too much and risk reigniting inflationary pressures."}],[{"start":218.35999999999999,"text":"None of this precludes further gains for US equities. Earnings growth, not macro forecasts, ultimately drives markets over time, and corporate profits have been strong. But the nature of those gains will probably look different from what investors have grown accustomed to. This is particularly relevant in a market still heavily influenced by a narrow set of megacap stocks and powerful themes such as AI. Innovation matters, but concentration risk does, too. Periods of instability have historically favoured diversification, not as a defensive posture, but as a way to capture opportunity across a wider set of outcomes."}],[{"start":264.75,"text":"One of the mistakes in volatile environments is the search for a single, dominant storyline. Is inflation defeated? Is the labour market breaking? Are equities overvalued or unstoppable? These questions may be emotionally satisfying but they are analytically limiting."}],[{"start":285.44,"text":"Instability resists clean answers. It rewards flexibility over conviction and process over prediction. It also challenges traditional forecasting tools, which often assume stable relationships. That does not mean abandoning discipline. On the contrary, it means anchoring decisions in fundamentals and long-term objectives, while accepting that the path between here and there is unlikely to be smooth. The takeaway is not a call to retreat from equities, nor a forecast of imminent trouble. It is a reminder that markets can move higher even when conditions feel uncomfortable; and that discomfort is often the price of admission for long-term returns."}],[{"start":334.24,"text":"In an unstable environment, the discipline investors need is not about predicting the next move in the S&P 500. It is about managing exposure, maintaining diversification and resisting the urge to overreact to every shift in narrative or data. Markets have often climbed walls of worry. What is different today is that the wall is less a single obstacle and more a constantly moving surface. Navigating it requires balance, patience and a willingness to live without tidy conclusions — qualities that, in market as in life, tend to age well."}],[{"start":381.81,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1768546911_9989.mp3"}