Reinhart Week in Review by Madison Investments 10.21.22


UK

Prime Minister Liz Truss has resigned. She will leave office having spent only about six weeks in the position.

Our Take: Liz, we hardly knew you. Markets revolted after hearing Truss’s budget proposals and the turmoil was too much for her to overcome. While losing the Prime Ministership obviously hurts, it may be a blessing in disguise. The next prime minister inherits an economy troubled by high inflation, high energy prices, and high taxes, all coupled with little to no growth.

MUNICIPALS

Wisconsin ended its fiscal year on June 30 with a record $4.3 billion budget surplus, according to a recently released report from the state’s Department of Administration. In addition, the state has a record $1.73 billion balance in its rainy-day fund. Wisconsin experienced higher-than-expected tax collections including an increase in sales tax revenue.

Our Take: Wisconsin’s record budget surplus and rainy-day fund balance is good news for the state and for bondholders. However, it is important to note that overall spending was below projections partly due to federal pandemic aid. In addition, the economic landscape has changed in recent months. Lawmakers should proceed with caution before they begin to request spending increases or tax cuts for the current fiscal year.

“Madison” and/or “Madison Investments” is the unifying tradename of Madison Investment Holdings, Inc., Madison Asset Management, LLC (“MAM”), and Madison Investment Advisors, LLC (“MIA”), which also includes the Madison Scottsdale office. MAM and MIA are registered as investment advisers with the U.S. Securities and Exchange Commission. Madison Funds are distributed by MFD Distributor, LLC. MFD Distributor, LLC is registered with the U.S. Securities and Exchange Commission as a broker-dealer and is a member firm of the Financial Industry Regulatory Authority. The home office for each firm listed above is 550 Science Drive, Madison, WI 53711. Madison’s toll-free number is 800-767-0300.

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This website is for informational purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security.

This report is for informational purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security.
Although the information in this report has been obtained from sources that the firm believes to be reliable, we do not guarantee its accuracy, and any such information may be incomplete or condensed. All opinions included in this report constitute the firm’s judgment as of the date of this report and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security.