Lots of New Jobs, Fears of the Fed, Lobster

September 6, 2026

STRONG JOBS REPORT: No one was expecting a six-figure jobs gain for August, and yet the U.S. economy added 162,000 net new jobs. This, and some revisions to prior months, make it appear that the job market is strengthening. The fears of an AI-induced labor market disruption have not come to fruition. Growth was broad across categories including construction and manufacturing. The unemployment rate remained at 4.1% because over 600,000 were added to the labor force, a healthy sign. Average hourly earnings rose 0.3% and are up 3.1% from a year ago.

STOCKS EKE OUT A GAIN: Stocks were meandering in a mostly positive direction for the week, but the strong jobs report on Friday put a positive week in jeopardy. The fear is that a strong labor market gives the Fed cover for deciding on an interest rate rise in the middle of this month. Bond yields rose as well on the same fears. UBS Group immediately came out announcing that it expects the Fed to raise rates in September and December. The CPI report next week will be closely watched.

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

ISM REPORTS SHOW U.S. ECONOMIC ACTIVITY IS STILL IN GROWTH MODE: The August Institute for Supply Management (ISM) manufacturing index came in at 54.6. Anything above 50.0 indicates growth. August's reading is a little lower than last month so the rate of growth slowed in August, but it is the 8th consecutive month of growth in the ISM Manufacturing index. Meanwhile, the ISM Services sector index came in at 55.4, which is stronger than July's reading. It has come in at 53.0 or above for nine consecutive months.

STRONG EARNINGS: 492 of the companies in the S&P 500 have reported second-quarter earnings, and 86% have exceeded Wall Street's expectations. The historical average is that 67% exceed expectations. Dell reported earnings last week, exceeding expectations with revenue jumping 58% year over year. Dell also increased its expectations for the coming year. Its stock rose 14.9% last week.

WELL SAID: An article I read this past week had a great, succinct paragraph about our current debt problem:

"Representative government has a structural bias toward the present. Every constituency that benefits from federal spending votes and organizes. The future generations who will pay for it have no lobby or voice." John Coleman, The Debt Dilemma Secretary Bessent Can't Fix, September 3, 2026.

According to that article, we have to either enact "real and difficult fiscal reform" (some combination of tax increases and spending cuts and reducing fraud), or grow the economy at the rate of about 4-5% per year for a decade. But pushing the problem off to future generations who have "no lobby or voice" seems to be an option that, fortunately, is becoming less popular.

LBJ: Lyndon Baines Johnson was president from 1963-69. As you can see below, I have been quoting a U.S. president each week in commemoration of the 250th anniversary of the Declaration of Independence. LBJ was this week. As some of you know, when I was just out of college, in the 1980s, I taught at a boys' high school in Palau, an island chain in the South Pacific. These boys came from all over Micronesia. Micronesia had been a trust territory of the U.S. since World War II, and many locals held the U.S. in high regard for rescuing them from Japanese dominance. This was evident as soon as I arrived. At this school, three of my students were named "Lyndon," "Baines," and "Johnson." We also had a "Nixon."

A WEDDING IN MAINE: We were invited to a wedding in Maine this weekend. The first thing we did in Bar Harbor was, of course, lobster!

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

dmacgray@stonecropadvisors.com

"There are plenty of recommendations on how to get out of trouble cheaply and fast. Most of them come down to this: Deny your responsibility." Lyndon Baines Johnson*

“After all, children should not have to save up for their parents, but parents for their children.” II Corinthians 12:14 (NIV)

*In commemoration of the 250th anniversary of the United States, I am finding a quote from a president each week, in order. This is the 36th week, and Lyndon Baines Johnson was our 36th president.

SOURCES:

STRONG JOBS REPORT: https://www.ftportfolios.com/Commentary/EconomicResearch/2026/9/4/nonfarm-payrolls-increased-162,000-in-august

STOCKS EKE OUT A GAIN: https://www.wsj.com/finance/stocks/rates-climb-stocks-dip-after-strong-u-s-jobs-data-a71b1a23?mod=stocks_news_article_pos1

ISM REPORTS SHOW U.S. ECONOMIC ACTIVITY IS STILL IN GROWTH MODE: https://www.ftportfolios.com/retail/blogs/economics/index.aspx

STRONG EARNINGS: https://myweeklystock.substack.com/p/weekly-market-recap-aug-31-sep-4?publication_id=697043&post_id=213893388&isFreemail=true&r=s86er&triedRedirect=true

© 2026 Anno Domini, Stonecrop Wealth Advisors, LLC, All Rights Reserved

*S&P 500: This is a measure of the performance of the 500 largest companies in the United States, and it is 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.

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

The information contained herein has been compiled from third-party sources (see above) and is believed to be reliable; however, its accuracy is not guaranteed. This newsletter is not an offer or a solicitation to buy or sell securities, and you should not construe it as investment, tax, or legal advice, or a specific investment recommendation. Any opinion included in this newsletter is our judgment as of the date of this report and is subject to change without notice.

If you want any additional information regarding Stonecrop Wealth Advisors, including management fees and expenses, you can contact us directly or review our Form ADV Part 2, which can be found here (www.adviserinfo.sec.gov), or which we will be happy to provide to you upon request. Only God knows the future, and so while past performance can be helpful information, it is not a guarantee of future performance, which could be completely different.

SDG