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An Orderly Succession, Soft Economic Numbers Lead to Stock Pullback, and Abby

  • Writer: Doug MacGray
    Doug MacGray
  • Aug 3
  • 7 min read

August 3, 2025


A SPECIAL ANNOUNCEMENT: This week in MacGray Matter, I want to start off with a special announcement which has already been shared with our clients. Here goes:


I am excited to announce that as of August 1, 2025, Logan D. MacGray, CFA, our current Investment Director was promoted to President of Stonecrop Wealth Advisors. In addition to maintaining his leadership in Stonecrop’s investment services, Logan will take responsibility of managing the firm.


I will be taking on the role of Chairman and CEO.


Logan has many qualifications for this role. He has fourteen years of experience in the investment and financial planning industry. He has a bachelor’s degree in finance and business administration. He completed the arduous and taxing process of obtaining his certification as a Chartered Financial Analyst four years ago.


Most importantly, we have been building the practice now known as Stonecrop Wealth Advisors for nearly a decade. I have grown to trust not only his work ethic and ability, but, more importantly for this role, his judgment, integrity, and passion for the mission of Stonecrop Wealth Advisors.


At Stonecrop, our foremost virtue that we try to instill in all our team members is “servanthood.” We seek to put our clients first in all we do. Part of that service is to make sure all our clients understand that they will be served well now, and for many, many years into the future. Because of that, I’ve been working at trying to surround myself with strong, talented (and somewhat younger) people who care about our clients (and any future clients) at least as much as I do. I began making sure my clients got to know other people in the firm, and that our service and processes were the same whether I was delivering them or someone else in the firm. I am thrilled with the team we have put together.


Beginning on August 1, Logan started leading that team.


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So, what happens to me? I am not retiring (I don't even like that word). I love this work, and I have no intention of leaving it any time soon. I’ll continue to be an advisor. This is the role that I will carry on indefinitely. I will also continue to help the firm gather new clients. I will continue to play an integral role in strategy, but I’ll leave tactics up to Logan and the rest of the team.


It has been exciting to preside over the establishment and growth of Stonecrop over the past five years after building a distinctive practice over the past quarter of a century. I am even more excited to see where, with my help, Logan and the team take Stonecrop.


Join me in congratulating Logan on this new role!


....and now, back to our newsletter.


SOFT JOBS REPORT: The U.S. economy added 73,000 jobs in July. The unemployment rate ticked up slightly from 4.1% to 4.2%. But that wasn't the biggest news in the most recent labor report. The U.S. Bureau of Labor Statistics revised their numbers for May and June and subtracted a total of 258,000 jobs from those reports, making the last few months look significantly slower. Year over year wage growth increased a bit from 3.8% to 3.9%. The strict immigration policies are likely affecting these overall numbers. Since January, the household survey shows that foreign-born employment is down 1.0 million, while native-born employment has increased by roughly 2.5 million.


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U.S. ECONOMY GREW BY 3.0% ANNUAL RATE IN SECOND QUARTER, BUT...: The U.S. economy, as measured by gross domestic product (GDP), grew at an annualized rate of 3.0% in the second quarter, which is good. But, the fact that the first quarter was negative and this quarter was a strong number needs to be looked at more closely. These contrasting outcomes, to a large degree, reflect reactions to tariff announcements. When the tariffs were announced, businesses began filling orders for products they anticipated they would need from overseas. They did this to beat the potential tariffs. Large imports lower the GDP number, and this activity was so robust, we got a negative GDP number in the first quarter. Once the furor over the tariffs subsided (some came and some didn't), businesses slowed overseas orders, shifting focus to ordering from U.S. suppliers, and GDP rose rapidly. If you put these two quarters together, real GDP is up about a 1.2% annual rate in the first half of the year, lower than what we want to see.


THE PCE INDEX INCHES UP IN JUNE: The Fed prefers the Personal Consumption Expenditures Index (PCE) as a better inflation measure. It was up 0.3% in June. It is running at a 2.5% annualized rate so far this year, but the year over year number increased from 2.3% to 2.6%. If you exclude food and energy, which the Fed also prefers, the year over year index increased from 2.7% to 2.8%.


THE FED HOLDS TIGHT: For the fifth consecutive meeting, the Fed held interest rates steady. Two voting members of the Fed dissented, the first time that has happened in over thirty years. In his press conference, Chairman Powell stated that the current Fed funds rate is only moderately restrictive and is not having a dampening impact on the economy. He did acknowledge that the first six months of the year has seen growth of 1.2% compared to 2.5% last year. He emphasized that the unemployment rate has hardly moved despite the softening monthly jobs numbers (averaging 130,000 per month this year, compared to 168,000 last year).


STOCK PRICES PULL BACK: Investors took some money off the table this week after the Fed Chairman's remarks, the soft labor market numbers, the slight uptick in inflation, and more tariff activity. Investors rushed to bonds, especially Treasury Bonds, sending yields down (and values up). It did not help that Amazon reported second quarter earnings that fell short of Wall Street expectations, sending its stock price downward.


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LONGER-TERM PERFORMANCE: Below are the annualized three-year and five-year numbers for these same indices.


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DOMINICAN REPUBLIC GETS UPGRADED: I am going to Santo Domingo in a month to visit with some of the schools that are doing such a great service to that community. This will be somewhere around ten or so trips I have made to that country, so I have developed a fondness for the place. I was gratified to see that this week, Moody's upgraded the DR's credit rating from Ba3 to Ba2. The outlook was raised from stable to positive due to its current high growth rates and economic diversification. Income levels have increased as well as has its economic strength, according to Moody's.


HELLO ABBY....AND WHAT A GAME!: For those of you who have worked with Stonecrop in the recent past, you have probably worked with Abby who does a lot of our administrative work and scheduling of appointments. We hired her as a remote position. She is from Texas, but now lives in Kentucky with her husband, a pastor. Although we see her all the time, neither I nor any member of the rest of the Stonecrop team had met her. We discovered that she and her husband were Phillies fans. (That is a longer story, but when they got married, because they followed two other teams, the Rangers and the Cardinals, they decided to go through a process of finding a team they could support together, and that process led them to the Phillies). Neither of them had ever been to Philadelphia let alone a Phillies game in Citizens Bank Park. We flew Abby and her husband into Philadelphia this weekend so they could see a Phillies game. We went Friday night. We did not plan it this way, but it also happened to be the night that Jimmy Rollins was inducted to the Phillies' Wall of Fame. We saw Jimmy's speech as well as old favorites like Steve Carlton, Greg Luzinski, Larry Bowa, and Ryan Howard. But then, we got to see a great game. The Phillies' bats did nothing for a while. But for the last few innings it got real exciting as the Phils battled back, and the entire stadium stayed on its feet for most of the rest of the game which the Phillies eventually won. To put the cherry on top, a new closer they had just traded for got his first save for the Phillies. Anyway, it was great to finally meet Abby in person and to treat her (and her husband) to such a great Phillies experience. Have a great week!


Our purpose is to honor God by helping our clients see the objective, find the path, and navigate past the obstacles to a more prosperous future.



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Douglas R. MacGray, J.D., C.F.P. ®

President

Stonecrop Wealth Advisors, LLC

Direct | Cell | Fax

(610) 628 4545




"The two most important days in your life are the day you are born and the day you find out why." Mark Twain


"He has told you, O man, what is good; and what does the Lord require of you but to do justice, and to love kindness, and to walk humbly with your God?" Micah 6:8


SOURCES:

U.S. ECONOMY GREW BY 3.0% ANNUAL RATE IN SECOND QUARTER, BUT...: https://www.ftportfolios.com/retail/blogs/economics/index.aspx


(c) 2025 Anno Domini, Stonecrop Wealth Advisors, LLC, All Rights Reserved


Investment advisory services offered through Stonecrop Wealth Advisors, LLC, a Registered Investment Advisor with the U.S. Securities and Exchange Commission.


SDG

*S&P 500: This is a measure of the performance of the 500 largest companies in the United States, and it a common index to track the performance of U.S. equity markets, especially the large cap markets.

*MSCI All Country World Index X US: This is a broad measure of the performance of worldwide equity markets excluding the United States.

*Bloomberg U.S. Aggregate: This is a measure of the U.S. bond markets.

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