Author Archives: Michael Murphy

Dear New World Investor: At last week’s Jackson Hole Fed conference. Chairman Powell said he expected this morning’s core July Personal Consumption Expenditures Index– the Fed’s favorite inflation measure – to be +4.3% year-over-year. Wall Street was on board: Click for larger graphic – read month-over-month (year-over-year) The core...

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Dear New World Investor: Tomorrow, Fed Chairman Powell speaks at the annual Fed symposium at Jackson Hole, Wyoming. Here’s what he will say: “We will continue to be data-dependent in determining the extent of additional policy firming that may be appropriate to return inflation to 2% over time. We...

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Dear New World Investor: Tuesday’s July retail sales report increased 0.7% from June, more than Wall Street’s estimates for +0.4%. Sales excluding auto and gas increased by 1.0%, well above estimates for +0.3% compiled by Bloomberg. June sales were revised up to +0.3% from +0.2%. Not surprisingly, the Fed...

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Dear New World Investor: Today’s Consumer Price Index report ticked up to 3.2% in July, lower than expected. Core inflation fell to 4.7%, in line with expectations. Click for larger graphic h/t @SteveRattner On a monthly basis, inflation hit the Fed’s 2.0% annual goal, with headline at 0.17%...

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Dear New World Investor: Oh, no! Fitch downgraded US government debt from AAA to AA+! I did not expect this! It dramatically affects… Nothing. Literally. Not. A. Thing. As Mohamed El-Erian said: “Why now? When you look at the reason, you scratch your head as to the timing of...

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Dear New World Investor: I was wrong. I thought that with inflation cooling, lagging components like rent set to fall for several months, manufacturing already in a recession, and labor markets cooling, the Fed would be smart enough to continue pausing interest rates and watching incoming data to see...

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Dear New World Investor: Cyclical bull and bear markets can last from several months to a few years. Secular bulls & bears last several years to decades and include multiple cyclical markets. The 2022 cyclical bear was far closer to the average cyclical bear in a secular bull than...

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Dear New World Investor: This is our next-to-last light week this quarter – the earnings deluge starts the week of July 24. The Radar Report is published on Thursdays. On Fridays, I repurpose parts of it in two Substack newsletters. Each has a free section and a paywalled portfolio....

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Dear New World Investor: Yesterday’s Fed minutes showed some of them were reluctant to back the pause that was finally decided. Almost all backed more increases in 2023 unless inflation comes down – no surprise there to us, although apparently Wall Street was shocked, shocked. Even after today’s new...

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Dear New World Investor: The economy is a little stronger than most investors expected while inflation (or at least the headline year-over-year Consumer Price Index) is slowing faster, cutting the foundation of the stagflation bears. Today, first-time jobless claims unexpectedly dropped to 239,000 from 264,000 last week. They were...

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