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June 17, 2024
DOES JEROME POWELL READ MACGRAY MATTER?: Last week, MacGray Matter included a longer-than-usual entry about anomalies in the jobs data, pointing out that the strong, sustained labor market may be overstated. After my email went out, the Fed had their meetings and announced that it was leaving its key interest rate unchanged. As part of his comments, Fed Chairman Jerome Powell stated, "You've got strong job creation, you have payroll jobs still coming in strong, even though there's an argument that they may be a bit overstated...." Am I an influencer?
CONSUMER PRICE INDEX UNCHANGED: According to the U.S. Bureau of Labor Statistics, the Consumer Price Index did not move in May after a 0.3% rise in April. Over the last 12 months, the CPI is up 3.3%, down from 3.4% the month before. Gasoline prices fell while costs for shelter rose. The "core" CPI, which removes food and energy prices, rose 0.2%, and the 12-month number moved down to 3.4% from 3.6% the month before. Those were positive numbers, but not good enough to convince the Fed to touch interest rates.
U.S. STOCKS RISE AGAIN: On the continued theme of a U.S. economy slowing at a "just right" rate, stocks rallied again this week. According to one report, a "steady trickle of recent economic data has continued to suggest the economy is cooling, but at a gradual pace and without any signs of serious deterioration." Tech stocks continue to lead running on AI enthusiasm.
LONGER-TERM PERFORMANCE: Below are the annualized three-year and five-year numbers for these same indices.
WORLDWIDE ELECTIONS: The world is holding lots and lots of elections this year which will influence the direction of global politics and economic markets. The European Union held elections last week, and there was a dramatic shift toward the center-right. France's results were dramatic enough to cause President Emmanuel Macron to call a snap parliamentary election. His party lost badly to the rival National Rally Party. Center right parties also gained in Germany, Greece, Poland, Spain and Hungary. Head of the European Centre-Right, Ursula von der Leyen, will lead the European Commission for a second term. The uncertainty created by these elections caused investors to dump European stocks causing a down week.
A TARIFF ON CHINESE EVS: The European Union has decided to impose a new round of tariffs on Chinese electric cars. The levies will be as high as 48%.
OLDER OFFICE BUILDINGS: A ten-story office building in Hell's Kitchen, New York City at 321 W. 44th Street just sold for under $50 million. It last sold for $153 million in 2018. The short sale was less than the outstanding mortgage of about $100 million. Office building values have dropped across the U.S. Older buildings are even more vulnerable to these price drops.
OLD AND YOUNG COUNTRIES: The countries with the oldest populations are:
Monaco (57)
Saint Pierre & Miquelon (51)
Japan (50)
Andorra (49)
Italy (48)
Saint Barthelemy (47)
Hong Kong (47)
Spain (47)
Germany (47)
The top ten youngest countries are:
Niger (15)
Uganda (16)
Angola (16)
Mali (16)
Chad (17)
DRC (17)
Benin (17)
Mozambique (17)
Guinea-Bissau (18)
Burundi (18)
The worldwide average age is 31.
GROWTH WAS NOT UNIFORM: According to the Bureau of Economic Analysis, overall U.S. economic growth in 2023 was 2.5%. The Southwest (Texas, Oklahoma, Arizona and New Mexico) experience much greater growth at 5.1%. The lowest was the Great Lakes region which grew by 1.2%. Both the New England and Mid-Atlantic states also grew by less than 2%. The second fastest growth region was the Southeast which grew at a 3.1% rate.
GREAT GOLF VENUE: There is a golf venue not far from me that I have never seen, until last week. The U.S. open was played here in 1962 and will be again soon. We only got in 12 holes because of lightning, but it is a beautiful course. Can you guess?
OVER THE MOON: Six years ago, my daughter moved to California for six months. Now, with a husband and a daughter of her own, she has moved back to the area! My granddaughter MacKenzie Gray, who has not completely warmed up to me yet, will become one of my best little buddies. The family of three settled on their new house last week (in a tough market) and will live with us while they paint the interior and re-finish the hardwood floors. I am blessed to have all three kids and all five grandkids living close by. Happy Fathers' Day to me!
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
"I would encourage everyone to play football for the simple reason that it is hard. It's hard when you're young to wake up in the offseason at 6 a.m. to go train and work out, knowing all your friends are sleeping in and eating pancakes.
"It's hard when you're on your way to practice weighed down with all your gear and it's 90 degrees out, while all the other kids are at the pool or at the beach. And your body is already completely exhausted from workouts and two-a-days.
"It's hard to throw, catch, block and tackle and hit kids when they're way bigger and way more developed than you. Only to go home that night bruised and battered and strained, but knowing you have to show up again the next day for just the chance to try again.
"But understand this: Life is hard … My advice is to prepare yourself. Because football lessons teach us that success and achievement come from overcoming adversity and that team accomplishment far exceeds anyone's individual goals."
Tom Brady
"For all can see that wise men die; the foolish and the senseless alike perish and leave their wealth to others." Psalm 49:10
SOURCES:
DOES JEROME POWELL READ MACGRAY MATTER?: https://www.washingtonexaminer.com/policy/finance-and-economy/3045950/jobs-numbers-overstated-what-to-know-fed-chairman-powell/
CONSUMER PRICE INDEX UNCHANGED: https://www.bls.gov/news.release/cpi.nr0.htm
WORLDWIDE ELECTIONS: https://www.bbc.com/news/articles/cnddkx7redro
OLD AND YOUNG COUNTRIES: https://cms.zerohedge.com/s3/files/inline-images/image_92%28669%29.jpg?itok=0DfPepew
GROWTH WAS NOT UNIFORM: Bureau of Economic Analysis and gritcap.io
A TARIFF ON CHINESE EVS: https://gritcap.io/p/deal-no-deal
OLDER OFFICE BUILDINGS: https://gritcap.io/p/elon-musk-said
U.S. STOCKS RISE AGAIN: https://www.wsj.com/finance/stocks/global-stocks-markets-dow-news-06-14-2024-095b9cfb
(c) 2024 A.D., 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 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.
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