MacGray Matter

Year-End Rally?, and Awesome Schools

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November 12, 2023

INFLATION DATA WILL HELP DEFINE THIS COMING WEEK’S MARKET OUTCOMES: In the coming days, investors will review the newest inflation data when the consumer-price index and producer-price index figures are released on Tuesday and Wednesday. In the last couple of weeks, U.S. markets have reversed their recent downturn. It may be a short bump in the midst of year-end malaise, or a year-end rally. You can find analysts predicting both right now. Earnings reports have not been decisive enough to fuel a rally on their own, and stock prices did not move down enough (with large cap stocks) to consider stocks cheap. The overall health of the economy will largely tell the tale so we will watch that data closely. The key markers we watch have not moved decisively and tell a mixed tale. If you are a long-term investor, all of this may be interesting, but you are probably sticking to your investment plan and not moving your asset allocation around much.

ANOTHER WEEKLY GAIN: Last week was reminiscent of what the earlier part of the year looked like, a weekly gain led by tech stocks and the NASDAQ. Stocks notched another weekly gain. The NASDAQ Composite was up 2.4% and the S&P 500 had another strong week. All week stocks rose except Thursday when Fed Chair Jerome Powell stated at a conference that the door is still open for more rate increases. That caused a negative day and ended an eight-day positive streak for the S&P 500.

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

HOTEL OCCUPANCY STAYING IN HEALTHY RANGE: As you can see below, hotel occupancy in the U.S. is tracking with last year and the 2000-2022 median, showing a full recovery from that year we all want to forget.

USED CAR PRICES DECREASING: Wholesale used-vehicle prices decreased 2.3% in October from the prior month. October prices were down 4.0% from one year ago.

NEW STANDARD DEDUCTIONS FOR NEXT YEAR: The standard deduction for 2024 will see a rise. For married couples filing jointly, the standard deduction will increase to $29,200, up from $27,700 in 2023. For single filers, the standard deduction will be $14,600, a rise from the $13,850 in 2023.

IT IS GETTING TOO DIFFICULT TO AFFORD A HOME IN THE UNITED STATES: Below is a chart showing the annual income needed to afford a median-priced home in the U.S. It has gone way up lately.

A QUICK TRIP: As many of you know, I, and Stonecrop, have support Edify, a group that supports low cost, private Christian schools in many developing countries. Occasionally, we are called on to lead or help with a trip to one of these countries. The Dominican Republic is the easiest to get to, though we have been to Uganda and Panama as well. The latter part of this past week (and while I type) we are on a trip to the Dominican Republic. I keep saying ‘we’ because my wife Deb and my son and Investment Director Logan came along as well. The work being done at these schools in very difficult areas is inspiring.

Have a great week!

Our mission is to help you 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

“The only function of economic forecasting is to make astrology look respectable.” John Kenneth Galbraith

“There will always be poor people in the land. Therefore … be openhanded toward … [the] poor and needy.” Deuteronomy 15:11 (NIV)

SOURCES:
HOTEL OCCUPANCY STAYING IN HEALTHY RANGE: https://str.com/press-release/us-hotel-results-week-ending-4-november
NEW STANDARD DEDUCTIONS FOR NEXT YEAR: gritcap.io
IT IS GETTING TOO DIFFICULT TO AFFORD A HOME IN THE UNITED STATES: gritcap.io, CNBC, Redfin
USED CAR PRICES DECREASING: Manheim.com

*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.

SDG

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MacGray Matter

Year-End Rally?, and Awesome Schools

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