Daily Commentary

MarketMinder’s View: Please note, MarketMinder is nonpartisan and isn’t for or against any specific policy. However, we do comment on policies’ downstream market and economic effects, and in our view, 2002’s Sarbanes-Oxley (SarbOx, or SOX in this article’s abbreviation) Act has done more harm than good. For a quick refresher, Congress quickly passed a strict form of SarbOx, and the sweeping change in corporate reporting rules added an additional headwind with a bear market already underway. Moreover, SarbOx’s onerous punishments (accounting errors meant criminal penalties for executives) led to much higher compliance costs—which America is paying for in a different way today. As explained in detail here, “For starters, SOX [SarbOx] is very expensive to comply with, typically costing companies millions of dollars per year, on an ongoing basis, and thousands of man-hours. The increased administrative cost has affected companies' decisions to go public. Some firms simply do not want the additional regulatory scrutiny that is associated with being public. As a result, fewer companies have gone public over time. In the late 1990s, there were more than 6,500 public companies; today, that number stands at 4,700, depending on the index. … As of 2025, there are now more exchange-traded funds than publicly traded stocks.” The analysis raises some other interesting points, including how SarbOx unintentionally benefited private equity in its current form (since many companies who would have gone public tapped private markets instead). Finally, “It is important to note that SOX does not prevent bear markets. The financial crisis still happened under SOX, which many people attribute to an obsessive focus on regulatory box-checking rather than prudent risk management.” One could even argue SarbOx’s tough penalties for executives with errors on balance sheets may have worsened the bank writedowns taken in 2008 tied to mark-to-market accounting, seeking to avoid liability. Well-intentioned as some rules may be, new laws create winners and losers—a reality worth internalizing whenever pols rail about the benefits of their proposed legislation.

MarketMinder’s View: According to the Port of Los Angeles, the country’s busiest seaport, imports fell for a second-straight month in September, but year-over-year total volume hit a record high in Q3. “The Port of LA processed some 883,000 container units in September, according to port data. About 460,000 of those TEUs [twenty-foot equivalent units] were loaded with imports, an 8% decline compared to September last year. Exports made up nearly 114,700 TEUs last month — almost identical to the same month last year.” These figures make sense given the current economic backdrop: The summer is peak shipping season as businesses prep for the end-of-the-year holiday shopping stretch, and the added wrinkle of tariffs and trade uncertainty likely motivated firms to import sooner rather than later, leaving a pothole in their wake. Experts project an import slowdown in Q4 and January 2026, which is possible. We also wouldn’t be shocked if tariffs start showing up in some prices next year, as firms have depleted their stockpiles and are starting to pay more for certain goods (depending on what they are and the country of origin). Some may choose not to pass those costs on, for fear of losing market share, but some might raise prices. But for now, the data we do have indicate how resilient US demand has been despite the uncertainty—a bullish, better-than-anticipated outcome.

MarketMinder’s View: Please note MarketMinder is nonpartisan and doesn’t prefer any politician or political party over another. Our political analysis focuses on the market and economic implications only. While Chancellor of the Exchequer Rachel Reeves’s Budget won’t come out for another 41 days, analysts are parsing her every word for clues of what her red briefcase (or ministerial box, if you like) will contain. The latest are Reeves’s comments at Wednesday’s IMF meeting: “I do think that those with the broadest shoulders should pay their fair share of tax, and I think you can see that through my actions last year at the Budget. … Wealth is obviously different from income. So wealth is not about your annual salary.” The article spills the majority of its pixels pondering what the Chancellor will and won’t tax (pensions are supposedly ripe for plucking while wealth levies and bank tax hikes aren’t on the docket). Some of the Chancellor’s comments may be trial ballons—a way for the Treasury to gauge the public’s appetite and markets’ approval (or lack thereof) for certain policies. But for investors, the key takeaway here is that the Budget—which is always more political theater than economic swing factor—has garnered a ton of attention recently, which saps its negative surprise potential and perhaps helps watered-down proposals qualify as positive surprise. We won’t outright dismiss the possibility the Budget will feature some proposals that stir uncertainty—as with all political matters, the human element is inherently unpredictable. But the ongoing public scrutiny allows stocks to pre-price the widely held opinions and outlooks—and move on.