Diastole Wealth Management

Diastole Wealth Management We are an independently-owned Registered Investment Adviser with offices in Guilford CT and Cincinnati OH. We are conservative, long-term investors.

If you're interested in more information, call 800 475-1088. Diastole only transacts business in states where it is properly registered, or excluded or exempted from registration requirements.

06/22/2026

DIASTOLE ECONOMIC AND MARKET COMMENT
June 22, 2026

Special thanks are due to Joe DePatie of Diastole for writing the Monday Comment last week while I played hooky. He wrote a wonderful piece and now I don’t have any job security.

A few things have happened since then. SpaceX stock started falling back to human levels after rising like a rocket after its IPO. This morning the stock is trading around $175 per share. It was initially listed at $135 per share and traded as high as $225 over the past ten days.

A cease-fire deal between the U.S. and Iran seems to be holding, while peace negotiations are ongoing in Switzerland. The Strait of Hormuz has opened, closed, and reopened again. Currently the Iranian government says it is closed, but some traffic is moving through it. Oil prices have fallen on all of this news, with both WTI (U.S.) crude and Brent (international) crude trading below $80 per barrel. We have China to thank for the relatively reasonable oil prices we have seen during the war with Iran. China opted to buy NO oil during the conflict, relying instead on its hefty reserves.

Last week was Kevin Warsh’s first Open Market Committee meeting as Fed Chairman. He indicated that instead of having the Fed move markets, he would prefer that markets move the Fed. Warsh gave the usual press conference after the interest-rate decision was announced, but he was a man of few words, both in his comments and his written summation of the meeting. We will learn more about his style as chairman as time goes by.

The FOMC announced no rate change at its meeting - as was fully expected and decided unanimously. Of the 19 governors on the Committee, nine anticipate a rate hike coming later this year. In March, that number was zero.

Rate hikes can be necessary to combat inflation, And inflation is what we see when we look at the latest Producer Price Index. In May it rose 6.5% over the trailing twelve months. And import prices increased 6.7% over the same period. U.S. retailers reported sales growth acceleration in May - not necessarily reflecting increased purchasing, but perhaps just increased prices on the same goods being bought. Under former Chairman (and still Fed member) Jerome Powell, the Fed’s target inflation rate was 2%. Chairman Warsh has announced his commitment to the same target.

According to Axios and Forbes Magazine, “Median household net worth in the U.S. is around $193,000.” Jeff Bezos is worth roughly $249 billion, while Elon Musk is now worth more than a trillion dollars. You know what that means, don’t you? Our piddly fortunes are now closer to the value of Bezos’s than his is to Musk’s. Yikes!

For the week ending on June 18th, the Standard & Poor’s 500 finished at 7,500, the Dow Jones industrials at 51,564, and the Nasdaq Composite Index at 26,517. The yield on the ten-year Treasury Note closed at 4.496%. WTI (U.S.) crude oil cost $73.61 per barrel, while Brent (international) oil cost $77.69 per barrel. New York Gold cost $4,155.68 per ounce, and one Euro was worth $1.14, reflecting a strengthening dollar.

Elizabeth E. Cook
Partner, Diastole Wealth Management

News and information presented here was gathered from sources believed, but not guaranteed, to be reliable, including (but not limited to) Morning Brew, Yahoo Finance, Barron’s, Bloomberg, The Wall Street Journal, Axios, USA Today, The Bureau of Labor Statistics, The New York Times, The Washington Post, The AP, Reuters, Fortune Magazine, Forbes Magazine, PitchBook, Morningstar, CNN, and The BBC. If you have questions, please call Diastole at 800-458-5220 or email me, Liz Cook, at [email protected]. Thank you for reading!

Elon Musk won’t see the entirety of his SpaceX payout until and unless he meets all the terms of the deal he made with SpaceX. One of them is that he establishes a permanent colony on Mars. Seems farfetched, but who am I to sell Elon short? In the meantime, NASA has revealed its plans to build a permanent Moon base. Before humans can live there, lots of machines will have to be delivered, and Jeff Bezos’s Blue Origin is one of the companies that will produce the machines. But Musk’s SpaceX is being contracted to deliver the humans. And meanwhile, the Chinese seem to be ahead in the race back to the moon. Oh, the drama!

06/16/2026

DIASTOLE ECONOMIC AND MARKET COMMENTARY
June 15, 2026

Last week’s turbulent market environment was accentuated by the largest ever initial public offering. Despite geopolitical headwinds, rising inflation, conflict uncertainty, and concerns about disruptions brought on by artificial intelligence, investors appear to remain optimistic about the future.

Space Exploration Technologies Corp. (Ticker: SPCX) successfully raised $75 billion from the largest initial public offering (IPO) in history, debuting at an initial market capitalization of over $1.7 trillion. Shares traded as high as $176.52 before settling at $160.95—almost 20% higher than the IPO price of $135.

This IPO generated massive investor interest for a few key reasons. First, the company undoubtedly provides cutting-edge services, including rocket launches, satellite internet, social media, and artificial intelligence. Second, the market has rarely seen a company this massive go public with such a small portion of its total shares available for public trading.

This limited float, combined with the fact that this mega-cap company is being included in market-cap-weighted indices, may trigger a significant amount of forced buying from institutional funds. It will be interesting to see how these liquidity dynamics are navigated, particularly with two more massive tech IPOs in the pipeline: Anthropic and OpenAI.

Unfortunately, inflation is running hot once again. Last week, the Consumer Price Index (CPI) grew by 4.2% over the last 12 months, marking the largest increase since 2023. The single largest contributor to this spike was an almost 25% surge in the cost of energy.

The textbook response to a hot data print like this would be an interest rate hike. However, with a new Federal Reserve chairman at the helm and clear, localized energy disruptions, will rates actually be increased? Markets are laser-focused on this week's rate announcement from the Federal Open Market Committee (FOMC).

Meanwhile, the European Central Bank (ECB) did raise interest rates last week in response to the economic fallout of the conflict in the Middle East. On a brighter note, news broke on Sunday that a deal between the U.S. and Iran has been struck, ensuring the Strait of Hormuz opens for business. Hopefully, this news translates to lower prices at the pump soon.

Inflation and SpaceX weren't the only major narratives driving markets last week. Semiconductor shares recovered after four of the world's largest data center operators raised their 2026 capital expenditure (CapEx) budgets to a collective $750 billion, with expectations to top $1 trillion in spending by 2027. Bitcoin continued its recent slide, falling to $63,543. For context, it traded as high as $126,198.07 during the second half of 2025.

For the week ending on June 12, the Standard & Poor’s 500 finished at 7,431, the Nasdaq Composite Index at 25,889, and the Dow Jones Industrials at 51,202. The yield on the ten-year Treasury Note closed at 4.48%. U.S. (WTI) crude cost $87.81 per barrel, International (Brent) crude cost $87.33 per barrel, New York gold cost $4,186 per ounce, and one Euro was worth $1.16.

Joseph DePatie CFA, CFP®
Financial Advisor

News and information presented here was gathered from sources believed, but not guaranteed, to be reliable, including (but not limited to) Morning Brew, Barron’s, Yahoo Finance, The Wall Street Journal, CNBC, Bloomberg, Axios, USA Today, CNN, The AP, The Washington Post, Business Insider, The New York Times, Reuters, Fortune, The Atlantic, The Hustle, and Popular Science. If you have any questions about what you’ve read, please call us at 203.458.5220, or write to me, Joseph DePatie, at [email protected]. Thanks for reading!

06/08/2026

DIASTOLE ECONOMIC AND MARKET COMMENT
June 8, 2026

There was a whopping jobs report released on Friday, which showed that 172,000 net new jobs were created in May - about twice what was expected. The unemployment rate remained unchanged at 4.3%. Yay, great news! Oh wait. Good news is bad news - again. Markets slumped considerably on Friday as investors realized that, in combination with rising inflation, strong jobs numbers will lead to higher interest rates, NOT the falling rates for which this administration is lobbying.

Savers like rising rates. Borrowers, of course, do not. And one of the biggest borrowers out there is the U.S. government, which has to sell Treasurys of various durations in order to fund its massive debt. If you are curious about the difference between our debt and our deficit, remember that our debt is everything we owe, while our deficit is the difference between THIS YEAR’S federal income and THIS YEAR’S federal spending. It is a one-year number. The U.S. fiscal year runs October 1st through September 30th.

The war with Iran is also still a major factor on stocks. And the stock indices have been responding up and down to news that the war is over, the war is expanding, the Strait is closed, the U.S. is escorting tankers through the Strait, Israel has signed a treaty with Lebanon, there are no material negotiations ongoing. Your guess is as good as mine. (Probably. Are you a military expert? Then your guess is much better than mine.)

Before Friday’s stock slide, markets were again making new incremental highs last week. And also pulling back slightly on news of oil prices rising, And on Friday, the chip stocks lead the rout, as those companies are borrowing tons of money to build data centers, hog all the fresh water, and create AI threats to humanity. But hey, those recaps of my emails are pretty sharp.

So we must ask the question that has recurred for several weeks now, maybe months. Why are equity markets (and bond markets to a lesser degree) rising overall during such troubled times? Well, one answer may be the K-shaped economy. The K-shape is meant to describe that upper-income households are doing better, while middle- and lower-income households are struggling. The upshot of this discrepancy is that consumer spending remains strong (buoyed by the wealthy) even while working families are facing inflation that is now running hotter than wage gains.

If you own stocks (probably mutual funds) in your retirement accounts, you are unlikely to sell based on market conditions, because you have limited access to those funds. If you have discretionary ownership of stocks, you are probably not selling them because they’re doing great and you don’t need the money (see the K-shaped economy, above). A correction is coming, but no one knows when. Make sure your conservative allocations are in place!

We keep hearing that 20% of the world’s oil is shipped through the Strait of Hormuz. So why aren’t oil prices higher? One big reason is that the Chinese have made a major shift away from fossil fuels, cutting their demand for oil by up to 9%. AND they’ve got more than one billion barrels in storage. Europe is following suit in terms of renewable energy. Plus, oil traders really really want to believe that the Strait will reopen soon.

A quick word about bitcoin (down by about half since October) and gold (down about 18% since January). Clearly money has moved from both “safe havens” into stocks during the recent equity climb. Will they rise if stocks start falling? Don’t know, but I do know that bitcoin fund Strategy just had to sell some of its coins in order to pay its dividend.

According to LiveScience, there were yeast growing on the body of Otzi the Iceman when he was discovered in the Alps in 1991, 5,300 years after his death. The yeast had been feeding on his frozen remains. Now scientists have used the yeast to make sourdough bread, which they describe as “very very good.” Thank you, no. You go first.

For the week ending on June 5th, the S&P 500 finished at 7,383, the Nasdaq Composite at 25,709, and the Dow Industrials at 50,866. The yield on the ten-year Treasury Note closed at 4.536%. U.S. oil (WTI crude) cost $90.81 per barrel, while international Brent crude cost $86.24 per barrel. New York gold cost $4,334.49 per ounce, while one Euro was worth $1.15.

Elizabeth E. Cook
Partner, Diastole Wealth Management

News and information presented here was gathered from sources believed, but not guaranteed, to be reliable, including (but not limited to) Morning Brew, Yahoo Finance, Barron’s, AFP News, CNBC, The Economist, The Wall Street Journal, Axios, Fortune, Business Insider, Reuters, Bureau of Labor Statistics, The AP, Bloomberg, USA Today, CNN, The New York Times, and LiveScience. If you have questions, please call Diastole at 203.458.5220, or email me, Liz Cook, at [email protected]. Thanks for reading!

Serena Williams is making a tennis comeback. The 44-year-old already has 23 Grand Slam singles titles, but she will be playing doubles at an upcoming tournament in London. Williams says she wants her children to see her play. Half a lifetime ago, I stayed up pretty late on Friday nights. Don’t think I could do it again. You go, Serena!

06/01/2026

DIASTOLE ECONOMIC AND MARKET COMMENT
June 1, 2026

You’ll want to check to see if today’s Comment was written last week or last month, but NO, it is today, and markets are once again at record highs. Inflation is rising, and so is the national debt, but oil prices are slightly down, the SpaceX IPO is coming, the ceasefire is holding in Iran (with the exception of the “fire” part), and AI is going to kill us or save us. All of that is apparently enough to keep stocks moving higher. Bonds are also moving slightly higher, causing yields to fall just a bit. The ten-year Treasury Note is now yielding just below 4.5% - a critical level at which investors start to abandon stocks for bonds.

With all that said, normally we could proceed to the more amusing part of our Comment, but NO, there’s more!

SpaceX is expected to start trading on June 12th, but a glance at its prospectus reveals “just how much the IPO depends on expectations for future growth and investor servility to Musk - not the current underlying business.” (Axios) About 85% of the money raised by the IPO could go directly to Musk (who owns 85% of SpaceX stock), increasing the chances that he will become the first trillionaire anywhere in the galaxy. But part of his compensation is dependent on whether SpaceX maintains “a permanent human colony on Mars with at least one million inhabitants.” So there’s that.

At the same time, Musk lost his lawsuit against OpenAI, when the jury determined that Musk’s lawsuit was brought after the statue of limitations had expired. That leaves OpenAI free to file for its own IPO.

The Federal Reserve Open Market Committee (FOMC) will meet again in two weeks - for the first time under the chairmanship of Kevin Warsh. At the FOMC meeting in April, Fed officials shifted their focus from upcoming rate cuts to upcoming rate hikes, as a result of rising inflation.

And that inflation was reflected in the Personal Consumption Expenditures Index (PCE), which rose by an annualized 3.8% in May. The Fed’s target for inflation is 2%. But our GDP (the sum of all goods and services produced in the U.S.) was revised downward from 2% in the first quarter, to 1.6% (annualized).

Interest rates are higher than they were last year because of inflation. and borrowing costs for the U.S. have tripled since 2021 to more than $1 trillion per year. Over the next year, $10 trillion in U.S. debt will come due and have to be refinanced with new bond issues. Rising yields will make that difficult for the U.S. to afford.

“Exxon warns oil inventories will hit dangerously low levels in weeks, forcing prices to shoot higher.” according to CNBC. That contradicts the oil prices that have slid lower recently. But even after the Strait of Hormuz is open, it is expected that the oil shortage will last until shipping is unsnarled.

According to the Wall Street Journal, “The summer is expected to be the worst for teen employment since 1948, as accelerating inflation and higher fuel prices squeeze the businesses that typically hire them.” My suggestion: apply for a job that AI can’t do. Dairy Queen might be hiring. (Yummmmmm, Dairy Queen!)

And recently, 274 climbers successfully scaled Everest - setting a record for a single day. Nothing says life goals like tramping one step at a time, carrying your own oxygen, with just a few seconds to admire the view.

For the week ending on May 29th, the Standard & Poor’s 500 finished at 7,580, the Nasdaq Composite Index at 26,972, and the Dow Jones Industrials at 51,032. The yield on the ten-year Treasury Note closed at 4.453%. U.S. (WTI) crude cost $89.81 per barrel, International (Brent) crude cost $85.58 per barrel, New York gold cost $4,514.49 per ounce, and one Euro was worth $1.17.

Elizabeth E. Cook
Partner, Diastole Wealth Management

News and information presented here was gathered from sources believed, but not guaranteed, to be reliable, including (but not limited to) Morning Brew, Barron’s, Yahoo Finance, The Wall Street Journal, CNBC, Bloomberg, Axios, USA Today, CNN, The AP, The Washington Post, Business Insider, The New York Times, Reuters, Fortune, The Atlantic, The Hustle, and Popular Science. If you have any questions about what you’ve read, please call us at 203.458.5220, or write to me, Liz Cook, at [email protected]. Thanks for reading!

According to Popular Science, three of the buttons you might push most in your life are actually “placebo” buttons - put there to make you feel better, but not actually doing anything. New York has approximately 1,000 crosswalk buttons, of which only about 100 work. Pressing more than once does not help. Likewise the elevator “close door” button, which won’t close the doors until a specified amount of time has passed. But the winner might be the lie of the office thermostat. According to a single HVAC installer, up to 90% of office thermostats are not working, to say nothing of stores, nursing homes, and restaurants. Side note to Diastole employees: our thermostats work. Don’t make the A/C too cold!

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