March 2026

The Slice

A Monthly Market Update & Investment News Roundup

Cutting through the noise...so you don't have to.

Good morning,

A quick word on the investment implications of what's happening in the Middle East:

• For now, the market is pricing in a limited conflict, with the S&P 500 set to open down about 1%, while the price of crude oil looks to spike 10%.
• For context, in the seven days following the start of Operation Iraqi Freedom, markets were down about 5%, but recovered those losses and then some after military operations began. In the Gulf War, markets dropped about 17% leading up to the conflict, then rallied 20% by the war's end. The price of oil doubled when Iraq invaded Kuwait, but then went back down by a third once the US began combat operations.
• Bonds are steady and gold is rallying.
• Taken together, for investors with a diversified portfolio, this isn't yet enough of a reason to change course, but for clients who want to use this as an opportunity to revisit their risk tolerance, I'm available and happy to talk.
  ------------------------------------------------------

At the dinner table recently, Cate, our 11-year-old daughter, accused us of “freeloading” off of her cheap labor in the form of chores.

Cate, pictured above, annoyed with her parents.

After Christy and I finished laughing, we reminded young Cate of the value of non-cash benefits we provide like private school tuition, sleepaway camp, and Lululemon cross-body bags, to say nothing of room, board, transportation, and life lessons designed to make her a future contributing member of society.

None of that laid a glove on her.

Source: The Wall Street Journal. Commerce Department, Labor Department, WSJ Calculations. Full article available here.

But what's happening in our family is somewhat analogous to how corporations are allocating their own cash. Increasingly, companies are rewarding capital over labor—meaning a growing share of income is flowing to corporate profits and shareholders, rather than to average workers’ wages. The Wall Street Journal's Greg Ip notes that since 2019, inflation-adjusted hourly wages have risen only about 3%, and total worker compensation is up roughly 8%. Corporate profits, meanwhile, have surged 43%. Over the longer run, the trend is even clearer: labor’s share of economic output has fallen from 58% of gross domestic income in 1980 to 51.4% by late 2025, while profits’ share climbed from 7% to 11.7%. From Cate’s vantage point, her allowance is kept unfairly low, even as her parents’ net income goes up.

Higher profit margins, all things being equal, beget stock market gains. Last month, the Dow hit 50,000 for the first time as projected profit margins over the next twelve months creep up towards 15% for large cap companies. 

How long can this go on?

The question of what happens next depends largely on AI. Dario Amodei, CEO of Anthropic, a leading AI model developer known for its chatbot Claude, wrote recently that “AI [not workers] is now writing much of the code at Anthropic.”

The company's recent release automates certain industry-specific tasks, including legal work such as contract review and compliance. The announcement sent software stocks down 5% in one day, even after a 15% decline in January. Industry specific stocks like LegalZoom were down as much as 20%.

Greg Ip points out that this isn't the first time that employers are prioritizing capital over labor. It's happened with the advent of factories, then computers, then automation. In each case, profits and stock prices went up, as wages suffered and workers were displaced. 

How long this continues is anyone's guess. At last year's US-Saudi Investment Forum, Elon Musk posited that, thanks to robots, work will eventually become optional.

For now, Cate, we still need you to put the laundry away and clean your room. 

Here’s what you need to know.

Markets

2026 Year-to-Date Asset Class Returns

Data thru 02/27/2026. Source: © Exhibit A, FactSet Research Systems Inc., Standard & Poor's  This slide is for informational and illustrative purposes only. The data provided is believed to be accurate, but there is no guarantee of its accuracy, completeness, or timeliness. This is not a recommendation or offer of any financial product. Past performance is not indicative of future results, and investors should consider their own objectives and risk tolerance. Indices, if presented, do not include fees, are unmanaged, and not available for direct investment. Definitions & Methodology: The returns shown represent year-to-date price performance of sector ETFs provided by iShares (EEM, EFA, TIP,AGG, DJP), SPDR (GLD, VNQ, MDY, SPSM, SPY, BIL), and Vanguard (VNQ). These ETFs track the following sectors: Commodities, International, Emerging Markets, U.S. Large Cap, REITs, U.S. Mid Cap, TIPS, U.S. Small Cap, Cash, and Bonds. Data is sorted by return from highest to lowest.

News & Notes

• Inflation Hasn't Been Tamed: President Trump touted falling prices in his State of the Union address, but sticky inflation continues to hurt affordability. (Barron's)
   

• Interview with Lone Pine's David Craver [Video]: David Craver, co-chief investment officer of Lone Pine Capital, discusses the evolution of market structure, the opportunities in AI, and the factors driving the firm’s long-term fundamental-based investing. (GS)

• Third Largest Coffee Chain in the U.S. Doesn't Sell That Much Hot Coffee: By focusing on customizable cold energy drinks, Dutch Bros thinks it has the formula to attract younger customers. (WSJ)
   
• Mortgages Fall Below 6%: The average 30-year mortgage rate in the United States fell to 5.98 percent, the mortgage-financing giant Freddie Mac said Thursday, down from nearly 7 percent around the same time last year. The last time the rate was below 6 percent was in September 2022. (NYT)
   
• Estimated Taxes Are a Pain: How to Avoid Costly Penalties: It’s important, but not easy, to get the timing right for tax payments on income that doesn’t have withholding. (WSJ) 
   
• Travel & Spend:
  36 Hours: Las Vegas (NYT)
  36 Hours: Savannah (NYT)
  36 Hours: Seville, Spain (NYT)
  
  Plus: Global Entry Program Suspended (NYT)

(Pie)Chart of the Month

Supreme Court's Ruling ➡️ No Significant Impact on Effective Tariff Rates

Source: The Economist, Yale Budget Lab.

On February 20th, the Supreme Court ruled that the International Emergency Economic Powers Act (IEEPA) did not give President Trump the authority to impose tariffs. But the ruling doesn't look like it will end up changing all that much in the short term. Within 24 hours of the decision, the President invoked Section 122 of the Trade Act of 1974, raising tariffs on imports back to 15%, close to where they were before.

Management Tip

Want to be a Great Leader? Become a Great Follower.

Strong leaders aren’t only defined by their charisma or ability to command—they’re also distinguished by how well they follow. Here’s how:

• Active listening. When you absorb input without defensiveness, you pick up on signals others miss and create space for honest dialogue.
   
• Focus on purpose, not personal credit. Put outcomes ahead of ego to cultivate a team that's focused on results over theatrics.
   
• Deliver reliably. Followers make things happen. Know how to turn plans into results and understand how work gets done—otherwise strategy becomes wishful thinking.
   
• Invite pushback. Good followers are open to being challenged. Make dissent safe and expected on your team.
   
• Stay coachable. Feedback isn’t a threat; it’s fuel. Followers are constantly learning, and leaders who keep learning stay relevant, self-aware, and adaptable in a changing world. 

Read the full article here written by Tomas Chamorro-Premuzic and Amy C. Edmondson. Published January 14, 2026.

Firm News

New Carefull Mobile App Available!

Your financial protection just got a upgrade. Carefull just released its new mobile app. What is it? Carefull is a financial protection service that defends you and your family's money, credit, and identity from thieves, scammers, and simple money mistakes. For PieCapital clients with assets under management, Carefull is included as part of your service.

Not signed up yet? Email us at hello@piecapital.com. Need to download? Click below!

Military Veterans Startup Conference - San Francisco

We hit the road in February. While out West, I got to interview my friend AJ about his team's recent company sale and exit at the Military Veterans Startup Conference in San Francisco.

PieCapital also co-hosted a dinner with Context Ventures for founders and conference attendees. Christy came, too!

Tax Season Reminders

• We provide all tax forms for managed accounts to clients via secure email by March 1st.
• Please note that we advise filing after March 1st due to tax documents being corrected from time to time.
• For those who uploaded their 2024 tax return last year, we will also provide you with a tax letter (see below) that you can forward to your CPA. The letter explains what tax documents he/she should expect from you, and what we did last year that may impact your return.

Why do we do this?

As we recommend more complex strategies involving the use of private capital, consolidating accounts, giving to charity, gifting to kids, setting up trusts, etc., a 1099 may not tell the full story of what was actually done, and we want to make sure you get the full credit for implementing these strategies at tax time by communicating them clearly to your tax professional. We hope it saves you and your tax professional some time.

You will still get tax documents directly from Schwab and our private capital providers (via mail or email, however you have elected to receive them). For those who don't want to wait, Schwab makes tax forms available on the following timeline:

If you have any questions or concerns regarding tax season or your tax documents, please contact Molly at molly@piecapital.com.

Hoops for NC Heroes Bracket Challenge

This month, you have the opportunity to support North Carolina veterans and servicemembers while cheering on your favorite teams in the NCAA Division I basketball tournament. I'm serving as tournament director again this year, and our goal is to raise $10,000 for the North Carolina Heroes Fund. Grand Prize is 4 Charlotte Hornets Tickets, and top scorers going into the Sweet 16 win a pie! $20 gets you in with 1 bracket, $35 or more gets you 2 brackets. Thanks to our corporate sponsor, Barringer Construction, for sponsoring!

Enter the tournament here!

Happy March!

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