Energy prices and Federal Reserve rate increases add to market uncertainty
U.S. stocks have ridden an extraordinary run over the past four years, providing gains to investors and retirement funds. The market has also been exceptionally volatile in 2026: on a single day this week, the tech-heavy NASDAQ suffered its biggest loss in months, although stocks overall ended the week not too badly. The volatile run has left investors on edge and might be signaling broader economic pain, host Scott Simon said in opening the interview.
Scott Simon asked Nam how markets could look strong one day and fall the next. By the numbers, Nam said, the economy looked sturdy, even as many people struggled with inflation and affordability and corporate profits were generally pretty good. All three major stock indexes had posted decent gains for the year.
Nam described 2026 as “a really strange 2026,” with rough patches amid substantial uncertainty. He identified the war with Iran, which has led to a surge in energy prices, Federal Reserve interest-rate increases and continuing concerns about AI as major pressures on the market.
James McCann, a senior economist at Edward Jones, said investors in a bull market watch for signs that momentum is fading. “I think as we get further through a bull market, investors are always looking for signs that that momentum and growth and earning cycle might be getting long in the tooth or fading,” he said. In other words, Nam said, investors are worried that the other shoe will drop, especially when it comes to AI.
AI, McCann said, is the most important sector for markets at present. He said a lot of the market gains over the past four years were driven by AI companies such as Nvidia. The concern is how long companies can continue raising massive amounts of money and growing, especially as rising interest rates make borrowing more expensive.
AI spending is not confined to companies developing the technology. McCann said those investments have become a significant part of business generally, and all kinds of companies now offer AI chatbots. Data centers are controversial, he said, but building them contributes to the economy.
McCann warned that an AI-sector hit or disappointment might not stay contained in the sector. He said it could spread more broadly and create wider distress across the economy and markets. Nam said that was why what happens with AI companies matters.
Meta provided a recent example. On Thursday, Meta said it would have to raise more money for AI. The announcement hurt the company’s stock and also helped bring the broader market down, according to Nam.
For investors, Nam said the most time-tested advice he heard while calling around was to diversify. A large California pension fund, CalPERS, told the Financial Times it was pivoting some investments away from big technology companies so it would not tie its fortunes to a single sector.
The other advice Nam said he received was to prepare for a rougher market. Investors with retirement funds or stock portfolios, he said, should expect that conditions could get bumpy.
The interview left the durability question open. Nam described a sturdy economy by the numbers and decent gains for all three major indexes, while McCann warned that higher borrowing costs and disappointment in AI could produce wider distress. For retirement funds and individual investors, the practical guidance Nam relayed was to diversify and brace for continued volatility.