Author Archives: Michael Murphy

Dear New World Investor: The S&P 500 decisively snapped a four-day losing streak today by gaining 330 points from its intraday low. The Index still lost 5.5% since last Thursday and fell 4.2% in August. It is down 16.8% year-to-date. And here comes September! When the S&P has been...

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Dear New World Investor: Friday at 10:00am EDT Federal Reserve Chairman Jerome Powell will address the Kansas City Fed’s annual Jackson Hole conference. Last year he said inflation was transitory to justify not responding to already-rising prices with higher interest rates. He was wrong. This year, he is expected...

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Dear New World Investor: The Fed minutes indicate they are full speed ahead on interest rate increases until either inflation cracks or unemployment shoots up. The Goldman Sachs Credit Impulse Index shows a hard landing coming for the economy with a stock market decline likely. Fed tightening takes seven...

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Dear New World Investor: The headline Consumer Price Index year-over-year change was 8.5% versus the 8.7% estimate and 9.1% last month. The month-over-month change was zero compared to the 0.2% estimate and 1.3% last month. That is the lowest month-over-month change since COVID hit, but the entire cause was...

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Dear New World Investor: The lesson of this market since the June 17 low is when stocks rally and very few investors can say why, and it looks absurd and un-fundamental, sometime those are the most vicious rallies. Everyone thinks the next lesson will be a dramatic reversal from...

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Dear New World Investor: The Fed raised the Fed funds rate ¾ of a percent (75 basis points or bps) to a range of 2.25% to 2.50%. The cumulative rate hike for June and July is the most aggressive since the early 1980s, yet the stock market exploded higher....

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Dear New World Investor: Tuesday was a 17:1 up day (advancing volume/declining volume), the best day since March 24, 2020. Combined with Friday’s 11:1 up day, it was the second 10:1 up day in three sessions. In the past, after two 10:1-or-better up days within three months without a...

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Dear New World Investor: Happy Bastille Day! July 14 is the French National Day celebrating the anniversary of the storming of the Bastille on July 14, 1789, a major event of the French Revolution. In the US, we could be celebrating the likely end of Fed fear as the...

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Dear New World Investor: The Federal Reserve Open Market Committee minutes from their June 14-15 meeting said: “Participants judged that an increase of 50 or 75 basis points would likely be appropriate at the next meeting.” OK, that negative is in the market. At the July 26-27 meeting, a...

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Dear New World Investor: The third estimate of March quarter real GDP growth released yesterday showed a 1.6% annualized drop in economic growth, a bit worse than the 1.5% previously reported. The update primarily reflects a downward revision to personal consumption expenditures (consumers buying less) that was partly offset...

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