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Indecisive Economic Data, Go Army, and Pasta Fail

Writer: Doug MacGrayDoug MacGray
Mar 25 min read

March 2, 2025


PCE INFLATION INDEX: The U.S. Bureau of Economic Analysis posted January's Personal Consumption Expenditure (PCE) index last week, and it increased by 0.3%. Year over year, the PCE index was up 2.5%. It was 2.6% last month. The peak for this index was 7.0% in June 2022. The PCE Index without food and energy was up 2.6% year over year. Last month that number was 2.9%. Investors' views on inflation, and how it will affect the economy and the Fed, are confused right now, and that is causing some volatility. This data point was largely viewed as positive, but not enough. In the year ending January 2024, the PCE index was up 2.6% year over year, and now that figure is 2.5%, so very little progress in the last year.


STOCKS STRUGGLE: Despite a late surge on Friday, U.S. stocks ended the week in the red again. Stocks have been struggling all month on fears of inflation and uncertainty regarding tariffs and their effects. In the S&P 500, seven out of the eleven sectors rose with financials leading the way, up 2.8%. Tech stocks were down 4.0%, which dragged down the S&P 500 index. Bonds, on the other hand, rallied. The yield on the 10-year treasury has dropped from 4.78% in early January to 4.22% at the close on Friday, and thus bond values have increased



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



INCOME INCREASES, BUT SPENDING DECREASES: In January, U.S. personal income rose by 0.9%. January's numbers get boosted by annual increases in Social Security benefits. Personal spending decreased in January by 0.2%. Spending may have been impacted by the California fires and cold weather in much of the country.


DURABLE GOODS RISE: New orders for durable goods in the U.S. rose by 3.1% in January. This follows two straight months of declines in November and December of 2024. Commercial aircraft orders surged, causing most of the monthly rise.


WEEKLY UNEMPLOYMENT CLAIMS: For the week ending February 22, there were 242,000 new unemployment claims, 22,000 higher than the prior week. The four-week moving average rose to 224,000, an increase of 8.500 from the prior week.



INDIA GROWING: Last quarter, India's economy grew at an annual rate of 6.2%. Increases in manufacturing, mining, agriculture, and government spending fueled the growth. India's economic performance will play a larger and larger role in the global economic dynamic as it is now the largest country, by population, in the world.


TWO OF THE MAGNIFICENT SEVEN: Year-to-date, Nvidia Corporation's stock is down nearly 7%. It has weathered a bit of a storm with cheaper AI competition hitting the market. In mid-March, it will host its annual GPU Technology Conference. Nvidia's CEO said, "we have some really exciting things to share with you guys at the GTC." Will the announcement move Nvidia's stock performance in March? Tesla, on the other hand, is suffering as investors worry about its CEO, Elon Musk, and his ability to lead the company through this critical juncture in the electric vehicle market as he also spends significant time with Space X and with the Donald Trump administration as the unpaid, unofficial leader of the Department of Government Efficiency. Tesla stock fell 27% in February. These two stocks are very influential on the performance of the S&P 500.


SO PROUD OF MY TEAMMATE!: Twenty years ago last week Jessica Bayer (now Jessica Chominski) raised her right hand and joined the United States Army. Twenty years! She still serves her country in the U.S. Army Reserve while also serving as a financial advisor at Stonecrop Wealth Advisors, where she is doing an incredible job. We hired her soon after she showed up for her first interview saying, "I don't think I'm fully qualified for this job, but I LOVE what this company is about, and I want to be part of it." Thank you for your service to our country and to our clients!



BAD IMPULSIVE MOVE FROM SOMEONE WHO SHOULD KNOW BETTER: My wife went out to eat with some friends one night last week, and so I was on my own for dinner. No problem. I decided to cook up some pasta. We had some gemelli which I put in a pan of boiling water. This pan is convenient because it has a lid which acts as a colander. All you have to do is hold the lid on the pan over the sink, turn it, and let it drain. I did that, but I was using potholders and being a little careless, and the lid slipped off. Yep, the entire pan of pasta fell into the sink, and because it is slippery stuff, it slid right into the garbage disposal. My dad was a plumber. His dad was a plumber. My uncle was a plumber (this is why I love the movie "My Cousin Vinny"). The point is, I should have known better than to do what I did next. In my impulsive frustration, I just turned on the water and hit the garbage disposal switch. That is a very bad move. You should never put pasta in a garbage disposal. Pasta expands in water. And this was so much pasta. It immediately clogged everything. Below is a picture of what is below the sink. I had to loosen all these pipes, and one by one clean out the pasta that was jammed in each section, all the way to the trap. Dinner preparation took a little longer than I had anticipated.



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.



Douglas R. MacGray, J.D., C.F.P. ®

President

Stonecrop Wealth Advisors, LLC

Direct | Cell | Fax

(610) 628 4545




"Time is what we want most, but what we use worst." William Penn


"So I saw that there is nothing better for a man than to enjoy his work, because that is his lot." Ecclesiastes 3:22 (NIV)


SOURCES:

WEEKLY UNEMPLOYMENT CLAIMS: https://www.dol.gov/ui/data.pdf


(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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