Thursday - March 5, 2026

Welcome to the dividend cafe weekly market commentary focused on dividends in your portfolio

and dividends in your understanding of economic life.

Welcome to dividend cafe.

Brian Cytell is with you here on your Thursday afternoon in markets that were down.

We had a rebound yesterday.

Markets were positive and would one day give it another day take it back.

Today we had the Dow down 784 points.

S&P was down half a percent Nasdaq down a quarter of a percent.

So is a broad base selloff and you did have better performance in tech on the day.

There was a may I related names that posted good earnings.

It boosted that sector.

But across the board selloff in stocks that said we were down significantly off of the lows.

We were actually down over 1100 a couple of hours ago on the Dow and closed down about 784.

Does that for 350 points off the low.

So meaningful move higher.

And you know what?

Honestly, since this thing began with Iran, we're down one third probably less than that now that the recovery happened.

But we're down about a third of a percent.

So really we're not down.

So markets are volatile, but they're directly have a change much because they're mostly paying attention to positive fundamentals on the economy.

As far as when this will subside, I wish I could tell you I obviously don't know.

But expect volatility, expect opportunities.

I wouldn't get shaken and we move forward.

So long as your portfolio is aligned the way that it should be.

And I'm certainly aware that it is if you're at the Bonson group.

We did have a pretty good economic act up on the day.

Three things.

One initial jobless plans were right in line with the expectations.

We got two 13.

That's good.

And the import price index was less than expected.

That's also good.

We got a point two instead of point three.

So two good.

Let's see what the third door gives us.

And we get US productivity substantially be estimates at 2.8% versus 1.8 expected.

And that's after last quarter, by the way, was revising significantly higher.

5.2 to 5.4.

So good things there on productivity.

And the question is what the productivity that AI has promised us actually showing up in real numbers now?

Because you have two quarters in a row.

And that's great.

My point I guess that I'll say here and did not write in the written is that labor costs were also up about 2.8% in the quarter.

Those two things can offset each other.

But nonetheless, they're good numbers on productivity.

And if we look back to the 90s, for example, the internet took about five to six years or so to start showing up in numbers.

The productivity gained the benefit as people got better computers and people got online and could communicate and look things up and use the internet for all the power that it is.

It took about that long.

We're about halfway through that runway with AI that said there could be a faster adoption rate.

I would assume there would be going from not having a computer first off to having one and to have one that could do more than just word process process back in the 90s and use the internet.

It's probably a longer runway than than what AI is when you can just download an app and send it on your phone to get it.

So I'll give it credit.

If it could be starting to flow into productivity, I sure hope it is.

I know the companies that spent hundreds of billions of dollars on it, certainly hope it is too, because that's good for everybody.

And I'm encouraged on what I'm seeing in the productivity side.

And I'm not quite convinced that's what it is.

And I'd like to see another quarter or two before we can start talking about the gain that we're seeing out of it.

The question that we had in there today, I actually got a similar version of this twice in different conversations with clients and prospective clients.

But it's essentially about the debt in the US in this particular question was about the war in Iran.

What if it turns out like Afghanistan at last super long and cost a lot of money?

Doesn't that add to the debt and hurt the dollar answer is like the war in Afghanistan was 20 years cost two trillion dollars a little bit more than that actually.

And most of that went to the debt.

So that's that's not good.

There's too many variables that I could have to guess of how this thing is going to play out by comparison.

So I won't, but just Afghanistan was a ground war.

We had a hundred thousand troops there at the peak.

It was costing us something like $300 million a day if you divide the total number of time by the amount.

But this has been a five day campaign.

It's solely bombings and no troops on the ground.

I'd be surprised if the administration has a conviction level to make a last for 20 years.

They won't be around that long themselves.

Nonetheless, we don't want to have it spent out of control unless that long.

Anyways, of course, when we're talking about Iran and the Strait of Formos, we're talking about a meaningful amount of global oil supply.

And every $10 move higher in oil means shaving a point 1% off of GDP.

And in adding about 0.2% to CPI if you think about that calculation.

So that's not good.

And that's the bigger factor really at this point.

Because we always spend about five billion on it.

Now five billion is a lot of money to you and I, but it's certainly not to the government.

I don't know how it's going to end.

So I can't answer the question fully.

Would it cost more than Afghanistan if it was a similar amount of time?

Yes, no question about it.

Thanks, past more number one.

And then Iran has all of the military that's so much larger in the oil and on the whole thing.

Do I think that it would add to debt?

Yes, I do.

Do I think that would hit the dollar?

It just depends on what the other global currencies are doing.

And ultimately what the dollar amount and price tag is.

So I can't really answer that exactly.

I suspect the dollar would perform or would continue to perform fine against other major currencies.

That is my take on it.

But too many unknowns there.

But nonetheless, that's what I have for you on the day.

I appreciate you listening.

As I always do, I appreciate your questions.

And if you get into the weekend without hearing from me or speaking to me, I wish you a good one.

And we'll talk soon.

Thank you.

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