February 2026 | Eternal Growth & Scary Monsters
I worked my first job in the financial services industry in 2017. In this particular role, I was fortunate enough to take part in multiple client meetings. A theme I noticed in these meetings, was the ongoing fear that “the market can’t just keep going up.” Despite these fears, the year 2017 saw the S&P 500 begin at 2,275, march steadily upward to end at 2,449, and as I write this 10th day of February, 2026, it now sits at 6,974. Indeed, it did keep going up, and has gone up since, save a few crises du jour.
Now, I will not lie to you. My skin also crawls at the seemingly imposed investment truth of “eternal growth” given by many in our industry. It feels wrong. How could the stock market just go up forever? Mustn’t all things come to an end? And though I share your suspicion of the idea, I must urge you to understand that it misses the point.
I was recently prompted to read the American classic Something Wicked This Way Comes by Ray Bradbury. Though it’s not Halloween, I enjoyed the book enough to borrow its “spooky” spirit for the following metaphor.
As an investor, there exists two vicious monsters nipping at the heels of your hard-earned wealth (and attempts to accumulate thereof). These two monsters do not sleep, they do not rest, and they do not discriminate. Their names? Inflation and Taxes.
With every year we go around the sun, your money purchases slightly less than it did the year before. Every April you complete the very document calculating the portion of your income which you will give to the Federal Government, and perhaps a certain state. These monsters live and grow with every extra dollar you earn. Yes, the doubt in an ever-growing stock market is scary. But these monsters are scarier.
Historically speaking, I know of no better way (on a risk-adjusted basis) to receive the types of returns that stand to slay these two monsters than that of a well-diversified stock portfolio. If you don’t believe me, I’ll let the numbers speak for themselves. Given the average American retirement age is 62, let’s go 62 years back to 1964. Since then:
The S&P 500 has increased by 80x.
The S&P 500 closed 1964 at 84.75 and ended 2025 at 6,845.50.
The cash dividend on the S&P 500 has increased by 30x.
The dividend in 1964 was $2.58 and in 2025 was $78.50
The Consumer Price Index (inflation) has increased by 10x.
CPI ended 1964 at 31.3 and 2025 at 326.
We do not invest in the stock market based on some naïve assumption of eternal growth. We invest in the world’s best, most innovative companies because we believe that participation in their enterprise (development of technology, sales of goods and services, improved efficiency, new patents, innovation, and forever so on) is the most worthwhile attempt to maintain and grow the purchasing power which will fuel your most precious goals and dreams.
MARKET UPDATE
At the moment, the S&P 500 sits near all-time highs, and the broader market continues to show resilience beneath the surface. While growth and technology have dominated for years, and may face pressure as investors scrutinize massive AI-related capital expenditures, market strength is no longer confined to a handful of mega-cap names. Instead, the Dow has passed 50,000 showing rotation into sectors outside of tech. Productivity gains remain solid, the labor market appears to be cooling rather than weakening, earnings growth seems sufficient to support current valuations, and inflation continues in a favorable direction. Importantly, valuations across much of the broader stock universe (i.e. value, small, mid-cap, etc.) remain attractive, especially as interest rates stabilize and the market continues to rotate. As always, uncertainty is unavoidable, and positive outcomes are never guaranteed, even in constructive environments. But if your goals and time horizon remain unchanged, so do we. Press on.
FRIENDLY REMINDERS
Tax Documents – For those of you with accounts at Schwab, your tax documents can be found through your client login under Accounts>Statements & Tax Forms. I’ve attached a PDF containing tax delivery deadlines.
IRA Deadline – The deadline to max out contributions for Traditional or Roth IRAs for 2025 is April 15, 2026. Each individual may contribute $7,000 for 2025, or $8,000 for those age 50 and older.
Backdoor Roth IRA Contributions – If you happen to be a high earner who has passed the phaseout limits excluding you from being able to contribute to a Roth IRA, you might be eligible to complete a “backdoor” contribution. The deadline for a 2025 contribution is April 15, 2026.
As always, please reach out to with any questions.
Sincerely,
Brock Hedgecoke, CFP®
Financial Advisor