WAS APRIL FOOLS' DAY MOVED TO APRIL 2ND THIS YEAR OR IS THE MARKET JUST PLAYING TRICKS? | Crouch Connection | April 2025

APRIL 2025

WAS APRIL FOOLS' DAY MOVED TO APRIL 2ND THIS YEAR OR IS THE MARKET JUST PLAYING TRICKS?

April began with a jolt, and no, it wasn’t a belated April Fools’ prank—it was the markets reacting to headlines around tariffs, economic data, and shifting Fed policy. As always, we're keeping a close eye on the data behind the drama.

Tariffs Take Center Stage…Again

  The Trump administration’s latest moves on trade have shaken global markets. But the ultimate impact will come down to whether other nations respond in kind—by removing their tariffs in exchange for the U.S. easing ours. If so, this could be a catalyst for freer global trade. If not, we may be in for a bumpy ride.

Rates, Real Estate, and a Spring Tailwind

The yield on the 10-year Treasury has moved sharply lower, a welcome sign for mortgage rates. With the spring home selling season ramping up, this could give the housing market a timely boost. Lower borrowing costs mean greater affordability, potentially fueling homebuyer activity in the months ahead.

Employment Data—A Recession Clue?

This Friday’s employment report will be key. Job growth remains one of the most telling indicators of economic health. A strong print would suggest the U.S. economy still has legs—lowering the odds of a 2025 recession. On the other hand, weakness would raise concerns about a slowdown taking shape.

The Fed Quietly Adds Stimulus

In a move that’s flown under the radar, the Federal Reserve has officially ended Quantitative Tightening (QT). While not grabbing headlines, this shift is a form of monetary easing—effectively adding liquidity to the economy. It’s a subtle, but meaningful tailwind.

Headwinds: Spending Cuts and Slower Immigration

On the flip side, cuts in federal spending and declining immigration levels may weigh on economic growth over the longer term. Both are structural drags that could slow GDP and dampen labor force expansion.

A Peek into Consumer Health: Darden’s Solid Quarter

Consumer strength is often best observed in the little things—like dining out. Darden Restaurants, the parent company of brands like Olive Garden and Longhorn Steakhouse, recently reported encouraging sales. It's a good barometer that consumers are still spending, for now.

AI: Fueling the Next Wave of Productivity

According to a recent Jefferies survey, 85% of businesses are using AI to boost efficiency and productivity. This adoption could have long-lasting implications for growth, margins, and even the future job market.

Recession Timing: History May Offer Comfort

Here’s a historical nugget from Federated Hermes: 9 out of the 15 U.S. recessions that have occurred in the past century occurred in the first year of a presidential term. If the pattern holds, and we are indeed in a slowdown, history suggests we may be closer to the end than the beginning—with several years of potential recovery ahead.

The Trade Deficit Puzzle

The U.S. trade deficit remains a hot topic. Causes vary by country, but many stem from currency manipulation, industry subsidies, wage suppression, and tariffs that make U.S. products less competitive abroad. This has triggered strong responses from the Trump administration and is at the heart of current tensions.

Is This Three-Dimensional Chess?

Some market commentators suggest that the administration policy mix—from tariffs to the so-called "3-3-3" plan—might be part of a much more complex strategy. Whether it’s chess or chaos remains to be seen, but it’s clear the global economy is entering a new and more dynamic phase.

A (Tongue-in-Cheek) Solution to the National Debt?

One final thought from one of my favorite pundits, Linda Duessell at Federated—maybe it’s time to sell the gold in Fort Knox and pay off the national debt? Just kidding... (sort of).

As always, we’re here to help you navigate through uncertainty and stay focused on your long-term goals. If you’d like to talk more about the current market landscape, or how this may affect your portfolio, don’t hesitate to reach out.

Wishing you a healthy and prosperous spring,

Dave Crouch

CEO & Chief Investment Officer

Aspen Grove Asset Management



Buffett Quote:

“There are 60,000 economists in the US, trying to forecast recessions and interest rates…if they could do it successfully, they’d all be millionaires by now.  As far as I know, most are still gainfully employed, which ought to tell us something.”

― Charles T. Munger (Buffett’s Partner) 

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