A cautionary note from NIPA corporate profits, plus 🧁 weekend sprinkles 🧁
The Sandbox Daily (10.3.2025)
Welcome, Sandbox friends.
Today’s Daily discusses:
a cautionary note from NIPA corporate profits
🧁 weekend sprinkles 🧁
Let’s dig in.
Blake
Markets in review
EQUITIES: Russell 2000 +0.72% | Dow +0.51% | S&P 500 +0.01% | Nasdaq 100 -0.43%
FIXED INCOME: Barclays Agg Bond -0.11% | High Yield -0.11% | 2yr UST 3.576% | 10yr UST 4.121%
COMMODITIES: Brent Crude +0.55% to $64.46/barrel. Gold +1.09% to $3,910.4/oz.
BITCOIN: +1.42% to $122,465
US DOLLAR INDEX: -0.14% to 97.707
CBOE TOTAL PUT/CALL RATIO: 0.81
VIX: +0.12% to 16.65
Quote of the day
“To forgive is to set a prisoner free and discover that the prisoner was you.”
- Lewis B. Smedes
A cautionary note from NIPA corporate profits
The year-over-year decline in National Income and Product Accounts (NIPA) corporate profits is in stark contrast to double-digit gains in S&P 500 earnings. NIPA profits have now declined YoY for two consecutive quarters.
This divergence with S&P 500 earnings growth highlights the difference between the stock market and the economy. Tariffs have weighed more heavily on economy-wide profits than on large publicly-traded corporations.
Although the convergence period may vary, the decline in NIPA profits implies a downside risk to S&P 500 earnings growth and stock prices.
NIPA corporate profits measure the economy-wide earnings of U.S. corporations, adjusted for inventory and depreciation, as reported by the Bureau of Economic Analysis.
They offer a broader, less volatile view of corporate health than stock market earnings, making them a key signal for long-term economic trends and investor sentiment.
Sources: Bureau of Economic Analysis, Ned Davis Research
🧁 Weekend sprinkles 🧁
Here are the ideas, sights, and sounds that caught my attention this week – perfect for quiet time over the weekend.
Blogs
A Wealth of Common Sense – 10 Things I’ve Learned About Wealth Management in 10 Years (Ben Carlson)
Verdad – Total Concentration (Brian Chingono)
We’re Gonna Get Those Bastards – If Nothing Changes, Nothing Changes (Jared Dillian)
Of Dollars and Data – Why the 5% Rule is the New 4% Rule (Nick Maggiulli)
J.P. Morgan Eye on the Market – The Blob: Capital, China, Chips, Chicago, and Chilliwack (Michael Cembalest)
Apollo – We in the Economics Profession Need to Look Ourselves in the Mirror (Torsten Slok)
Stansberry Research – Five Reasons the AI Boom Isn’t in ‘Dot-Com’ Bubble Territory (Yet) (Alan Gula)
Podcasts
Excess Returns with
and Kai Wu – 10 Stock Market Truths Investors Get Wrong (YouTube, Spotify, Apple Podcasts)Movies/TV Shows
aka Charlie Sheen (Netflix, IMDB, YouTube)
Black Rabbit – Jude Law, Jason Bateman (Netflix, IMDB, YouTube)
Music
3 Doors Down – Away from the Sun (Spotify, Apple Music, YouTube)
Donda – True Love (Spotify, Apple Music, YouTube)
Books
– Money Together (Amazon, Harriman House)Fun
Zach Bryan at Michigan Stadium – GO BLUE ! (Instagram)
That’s all for today.
Blake
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Welcome to The Sandbox Daily, a daily curation of relevant research at the intersection of markets, economics, and lifestyle. We are committed to delivering high-quality and timely content to help investors make sense of capital markets.
Blake Millard is the Director of Investments at Sandbox Financial Partners, a Registered Investment Advisor. All opinions expressed here are solely his opinion and do not express or reflect the opinion of Sandbox Financial Partners. This Substack channel is for informational purposes only and should not be construed as investment advice. The information and opinions provided within should not be taken as specific advice on the merits of any investment decision by the reader. Investors should conduct their own due diligence regarding the prospects of any security discussed herein based on such investors’ own review of publicly available information. Clients of Sandbox Financial Partners may maintain positions in the markets, indexes, corporations, and/or securities discussed within The Sandbox Daily. Any projections, market outlooks, or estimates stated here are forward looking statements and are inherently unreliable; they are based upon certain assumptions and should not be construed to be indicative of the actual events that will occur.
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