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The Tallest Wall of Worry of My Career Thumbnail

The Tallest Wall of Worry of My Career

There's an old saying on Wall Street that stocks "climb a wall of worry." I've written about it here before — more than once — and in my 32nd year as an investment advisor I've watched markets climb some impressive walls: the Asian Financial Crisis, the dot-com bust, 9/11, the Great Recession, a global pandemic. But I'll be honest with you… the wall in front of us right now may be the best evidence of that old saying I've seen in my entire career.

Consider the backdrop:

  • War on three fronts. Russia and Ukraine. Israel and Hamas. And now the United States and Iran.
  • Oil. With traffic through the Strait of Hormuz and the Bab el-Mandeb restricted by the fighting, oil has pushed past $100 a barrel.1
  • Interest rates. The 10-year Treasury yield just hit its highest level in 19 years2 — thanks in no small part, in my view, to profligate government spending around the world.

Here's my confession: if you had handed me that list last December and asked what to do, I would have been TEMPTED to go to cash. Sit it out. Wait for the dust to settle — and get back in once things "made sense" again.

And yet… I believe markets have been strong! Through September 23, the S&P 500 was up 13.5% for the year, dividends included.3 No, that is not a misprint!

Think about that. Three wars, oil north of $100, and the highest borrowing costs in nearly two decades — and the broad U.S. stock market has delivered a year most investors would have happily signed up for in January. Even when you KNOW bad things are happening to some of the most important inputs to a healthy economy, markets can still go up. They often do.

Why is that?

Stock prices are ultimately a reflection of what companies can earn — and of our confidence in sharing in those earnings down the road. Markets are also forward-looking; by the time a crisis is on the front page, much of it is already reflected in prices, and investors have moved on to what comes next.

Those who have been clients for a while know I'm no predictor of markets over the short term — my crystal ball has been blurry for three decades — and this year is a good reminder of why. Even if I had known exactly how world events would unfold, I would not have known how markets would RESPOND to them. Those are two different predictions, and the second one is much harder than the first.

There's a second lesson hiding in this year's numbers, and it's the one I care about most. In the first half of 2026 the S&P 500 gained 9.6% while the seven largest U.S. technology companies — the so-called "Magnificent 7" — were collectively NEGATIVE.4 Those seven companies still make up roughly a third of the index.5

Investors who let their portfolios drift into those few names — because that's what worked for the last decade — missed much of what the rest of the market delivered. The laws of finance, like the laws of gravity, can only be suspended for so long…

So what to do?

  1. Don't try to time markets. Going to cash this year would have felt prudent — and would have meant sitting out a strong year.
  2. Stay genuinely diversified. Own the whole market — U.S., international, small and value — not just the handful of names that happen to have led recently.
  3. Build for the walls you can't see yet. Next year's worry list will look different. It always does. Make sure your allocation, your liquidity and your estate plan hold up no matter which items end up on it.

Bottom Line

The walls will keep coming, and some of them will be tall. Humbly acknowledge that even if you believe you know how world events will play out, you do not know how markets will respond to them. Dispassionate decisions made with data around the dinner table — not with the headlines — are what get families over the wall.

Mike Johnson

Author

Mike Johnson, MBA

Mike Johnson works with individuals and families navigating major financial events where taxes can have an outsized impact—from selling a business or appreciated real estate to taking a significant retirement distribution. He specializes in event-driven tax mitigation, identifying opportunities to reduce unnecessary taxes before, during, and after these financial transitions. With more than 30 years of experience, he replaces emotion with data and makes complex strategies easier to understand. The goal is simple: help clients make informed decisions, keep more of what they’ve built, and have a tax and investment strategy they understand and trust.

Sources

1. Al Jazeera, "US says it's clearing Hormuz traffic: Why are oil futures beyond $100?," September 14, 2026.

2. CNBC, "10-year Treasury yield rockets to 19-year high," September 23, 2026.

3. ChartRow, S&P 500 year-to-date total return with dividends reinvested, through September 23, 2026. The S&P 500 is an unmanaged index; investors cannot invest directly in an index. Past performance does not guarantee future results.

4. Sam Ro, CFA, "The first half of 2026 confirmed a valuable stock market lesson," TKer, July 2026.

5. Forbes, "S&P 500's Weight In Mag 7 Stocks Passes 30%. Is This A Diversification Risk?," September 2026.