Author Archives: Michael Murphy

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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Dear New World Investor: Wednesday and Thursday were the Fed’s semiannual Humphrey-Hawkins testimony to Congress. “Even if inflation accelerates, we aren’t going to raise rates,” said nobody, ever. Of course Chairman Powell said they may raise rates further if inflation doesn’t head down towards 2%. The next Fed meeting...

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