“Every positive change in your life begins with a clear, unequivocal decision that you are going to either do something or stop doing something.” Anonymous

Good morning,

The gift of consciousness can be overwhelming.

Our awareness of uncertainty, our innate tendency to want to avoid both conflict and risk…..coupled with the fact that our days are flooded with a busy mind can make it impossible for us to make decisions. Of course, being able to think about ourselves as having a past, a present, and a future is a significant evolutionary advantage. Our ability to self-reflect in increasingly complex ways about the past and future is a distinct feature of consciousness, and it has enabled us to become highly adaptive, inventive, and successful.

However, it’s this advantage can also be attributed to our inability to make decisions, particularly in an uncertain environments.

Ward Edwards, an American psychologist born in 1927, developed much of our early thinking on why and how we make the decisions we do. He argued strongly that we shouldn’t judge how good our decisions are according to their outcome - some luck or misfortune typically plays a part, as do many other factors out of our control. Instead, Edwards advised that to make good decisions, we need good decision-making processes and focus on elements that are within our control.

One of the many lessons that the last few years have taught us is that, as individuals, as business owners, as leaders…..we cannot predict what is around the corner, but we can - and must – develop our personal strategies, our strategic organizational plans, and our styles of leadership, for uncertain times. If we change our mindset, we can come to understand that much of the uncertainty we face comes with new possibilities.

Uncertainty presents a special challenge since few of us have received training in how to deal with it. The challenge is that all growth, change, and transformation inevitably come paired with uncertainty. We have to go through the uncertainty to get to the possibility, and it’s our ability to make decisions that shape our destiny.

It’s been said that “sometimes in life, you have to make decisions that are best for you, not for everyone else.” And Jim Rohn famously said that “You cannot make progress without making decisions.” As we make a conscious choice to transform our view uncertainty into infinite possibility, I wanted to share three strategies that can assist in your mindset shift and help you make those important decisions:

Understand your values

It’s important to self-reflect. If you have a strong understanding of what motivates you, what is important to you, and who the person is that you wish to become, decisions are easier to make when you know yourself.

Be clear on the objective

Understand the decision in front of you and recognize what you hope to accomplish with this decision. Whether you are making a change in your professional career, you are acquiring a business or making a decision that will impact future generations of your family, understanding your own personal objective is powerful.

Value time

We are great at convincing ourselves that we have plenty of time, but we know this not to be true. Time is constantly passing through your life and we are losing one moment to the next. You have fewer options available to you as you approach any type of deadline. Your time has value and those that wait too long have no choices at all.

These strategies may seem simple and obvious, but if you take the time to understand yourself, your objective, and be sure to give time itself the respect it deserves…. it can provide you the confidence to turn consciousness into courage.

“There is no one standing on the riverbank watching the contents of consciousness flow by. There’s only the river” Sam Harris

And now, to the markets

Global markets seesawed a bit in recent weeks, but then jumped higher in recent days on the back of some softer U.S. inflation data. Bond yields had similarly large moves. There were additional notable U.S. developments too: another outsized interest rate hike and mid-term elections. While undoubtedly headline-grabbing in nature, we don’t view the investment outlook as having meaningfully changed.

In recent days, the October reading of the consumer price index (CPI) in the U.S. was released. The index rose 7.7% year over year, suggesting inflationary pressures are still very high. However, the reading was below most forecasts, and marked a deceleration from the previous month. The October release adds some credence to the view that the U.S. may be past the worst of the inflationary pressures, for now.

The weaker inflation data is also likely to fuel the debate as to when the U.S. Federal Reserve can slow its aggressive rate hiking campaign. The Fed recently raised interest rates by 0.75%, the fourth consecutive outsized move. More noteworthy were Mr. Powell’s comments, in which he indicated the pace of future rate hikes will inevitably slow at some point, similar to the messaging from other central banks like the Bank of Canada. However, he affirmed it is premature to talk about a pause, and strongly indicated that rates will still have to be higher and more particularly “sufficiently restrictive” to slow the economy, reduce inflation, and most importantly ensure future inflation expectations stay contained. That left investors wondering whether rates will not only be higher, but remain so for a longer duration.

As inflation slows, so too should the pace of interest rate hikes from central banks, which should lead to greater market stability, particularly in the bond market. Economic momentum should also fade as this year’s rate hikes begin to more meaningfully affect the behavior of consumers and businesses. A recession seems almost inevitable, but it may take some time to develop. The North American economies have proven to be resilient, with businesses still looking to hire and consumer spending remaining robust. We expect this to eventually change at some point in 2023.

The markets have undergone a significant repricing this year given the inflationary backdrop…..it has resulted in a wide range of income producing opportunities that now look relatively attractive. We continue to find excellent opportunities and intend to continue to add into our allocations as rates and dividend income look more and more attractive.

“You can't make decisions based on fear and the possibility of what might happen.” Michelle Obama

As we head into the week, give some thought to the big decisions that await you on the journey ahead. Make the time to reflect on what is important to you. As you reflect, focus on the think you can control:

Your words

Your effort

Your energy

Your focus

Your actions

Your perspective

“Whatever you decide to do, make sure it makes you happy.” Anonymous

Be well and enjoy the moments

Derek