• Soaring earnings and AI spending are fueling a bull market with signs of resilience.
• An extended oil crunch could lead to higher rates and inflation that might weigh on stocks.
• Investors may be underestimating the severity of global energy supply stress.
• The path of oil prices could determine whether stocks soar or stumble.

Thus, “Energy prices may hold the keys to where the stock market goes next.”

A chart illustrating the causes of the oil supply crunch, as presented in the Fidelity Viewpoints article, appears below.

Source: Bloomberg, as of May 10, 2026

Compounding the economic situation with economic and political policies that are dependent upon our kakistocracy government, we cannot make any sure bets regarding future stock prices. I would continue to build up cash reserves using a fund such as BOXX, for example.

Given that we are in something of an investment purgatory, there are still some vetted stocks to consider. For growth, stocks such as CENX, ALB, DRD, MU, YPF, LYB, SBLK, MTDR, INR, VIST, PBF, and MEOH should be given closer attention. For growth and dividends, consider: BP, ECO, SBLK, SHIP, ABEV, BBDC, CURI, and DEC. From the highest rate of growth to the lowest, the ETFs that performed best over the previous three months were: XSD, FTXL, PSI, SOXX, and SOXQ.

Many of these stocks and funds are related to energy prices and the AI investment boom. Investing in those two areas is likely to pay off the most. As always, good investing!

The post May 2026 Stock and Fund Picks first appeared on MarchéEconomics.

Higher oil prices have seeped into consumer confidence, according to the latest University of Michigan survey. The April consumer confidence report’s headline index fell to 47.6, an all-time low, which was down 10.7% compared to the prior month. Americans’ inflation expectations jumped sharply amid the ongoing conflict with Iran. Changes in consumer confidence can impact spending, which represents roughly two-thirds of the US economy.

The Schwab Market update for April 24 adds further context by pointing out that one thing to watch is:

Inflation under scrutiny: Today isn’t completely quiet on data, as investors get the final April reading on University of Michigan Consumer Sentiment at 10 a.m. ET. The Briefing.com consensus is 47.6, unchanged from the record-low preliminary figure released earlier this month. Inflation expectations for the long term, which rose to 3.4% in the preliminary report from 3.2% in March, are worth a close look. Any uptick might attract the Fed’s attention, as policymakers remain concerned about keeping long-term inflation expectations anchored. They tend to pay less attention to short-term inflation expectations, which also rose in the preliminary report but are closely tied to gasoline prices. Despite sentiment being in the basement, early indications from earnings season across sectors show consumers continuing to spend, an interesting dichotomy that may point again to the so-called “k-shaped” economy in which high earners keep opening their wallets.

Thus, there appears to be headwinds on the supply-side of the economy related to two factors: 1. tariffs and 2. the oil supply shock caused by apparently unresolvable Iran “situation.” The oil supply shock is reminiscent of the mid 1970s. Adding to this is the possibility of a demand-side collapse comprised of lower income earners. Both the supply-side headwinds and the possible demand-side collapse will hurt the labor market and increase unemployment. There are offsetting inflationary effects with the demand-side collapse bringing prices down and the supply-side shocks pushing prices, such as for gasoline, up by a very large amount.

On top of these problems, we appear to have a government with no leadership or direction, other than to attack voters and citizens, and with no solutions to any economic problems other than lies or ignorance. Not surprisingly, this President is very, very unpopular.

Yet, we have not yet entered a recession. However, the overvalued stock market is looking more and more like Willie Coyote after he runs off a cliff. I would build up some cash and “look out below.”

Given this, some stocks to consider for the near term include: TBPH, DRD, VIST, SNEX, CHWY, and MCY. Some dividend growth stocks include: EC, SBLK, SHIP, ABEV, CRRFY, HSBC, III, KRP, REYN, and VTS. Over the previous three months, the top ETFs were: PSI, IDGT, FTXL, SOXX, and SXD. Most of these were in the semiconductor sector.

For those wanting to develop an investment portfolio of CEFs that earn high dividends to be re-invested or used as income I have several suggestions. All of these are selling at discounts to net asset values. Most should tend to mean-revert in the long-run.

For those with tax sheltered accounts such as 401k’s and that have required minimum distributions after you reach a given age, consider: BDJ, RLTY, UTF, PDX, DHF, PFO, NML, NBXG, SPE, PDX, FTHY, BGB, BANX, EOS, BOE, BGY, BTX, BST, RNP, JRS, BUI, DPG, MEGI, BMEZ, ECF, BCV, NCV, NCZ, IGA and NXG. Making trades will not lead to paying capital gains taxes in these accounts until you take the money out.

For those with non-tax-sheltered investment accounts that require you to report any capital gains and pay taxes on them I have a list of funds that are much more tax friendly with respect to their dividends. These include: HTD, PDT, ETB, ETV, EXG, ETW, ETJ, EVT, ETG, ETO, BST, PML, and FLC. Most of these dividends are either qualified or in the form of long-term capital gains. If you live in Minnesota, you might want to consider NMS for which the dividends are tax exempt at both the State and Federal levels. Moreover, the after-tax return on NMS is relatively high.

Remember that diversification within any type of portfolio is one way to reduce overall investment risk.

That’s all I have for this time. As always, good investing!

April 28 update: Zacks Investment Research has provided an updated analysis on the Iranian situation and what it implies for oil related investments:

What the Hormuz Crisis Means for Energy Stocksby Jeremy Mullin Stock Strategist and Editor of Zacks Counterstrike and Commodity Innovators Posted on 4/27/26
ServicesInvestor ServicesInvestor CollectionETF InvestorHome Run InvestorIncome InvestorStocks Under $10Value InvestorZacks Top 10Innovator ServicesAlternative EnergyBlockchainCommodityHealthcareMarijuanaTechnologyOther ServicesZacks ConfidentialZacks Premium Trading ServicesZacks UltimateBlack Box TraderCounterstrikeHeadline TraderInsider TraderLarge-Cap TraderOptions TraderShort Sell ListSurprise TraderTAZR  The S&P 500 and Nasdaq Composite are sitting at all-time highs, driven largely by strength in AI-linked technology names. Despite escalating tensions around the Strait of Hormuz, equity markets have remained remarkably calm.That calm might prove to be misleading as crude oil is still trading in the mid-$90s. In early March, Iran effectively shut the strait, sending tanker traffic sharply lower and war-risk insurance costs surging. Oil responded immediately, with Brent spiking from the low $70s to nearly $120 at its peak. Even after a fragile ceasefire and repeated reopenings, disruptions have persisted and price volatility has followed.Here is what matters for investors: the resolution of this conflict is almost beside the point. The world has just been reminded, in the most expensive way possible, how fragile global energy supply chains really are.That realization creates a structural tailwind for U.S. producers that does not depend on continued escalation.The question is which names are positioned to benefit.How We Got HereThe Strait of Hormuz is a narrow waterway roughly 21 miles wide at its chokepoint, sitting between Iran to the north and Oman to the south. Before the crisis, approximately 20% of the world’s seaborne oil trade and 20% of its LNG passed through it daily. There is no adequate alternative to fill that gap. Saudi Arabia and the UAE have limited overland pipeline capacity, but nowhere near enough to absorb full Gulf export volumes.The arithmetic of the disruption is staggering. The collective oil production of Kuwait, Iraq, Saudi Arabia, and the UAE dropped by a reported 6.7 million barrels per day by March 10, and at least 10 million barrels per day by March 12. For context, the 1973 Arab oil embargo cut roughly 5 million barrels per day. This disruption has already exceeded that threshold by a wide margin.Iran did not need to defeat the U.S. Navy to make this work. It only needed to make the strait too dangerous and too expensive for commercial traffic. War-risk insurance premiums for tanker transits surged from 0.125% to between 0.2% and 0.4% of vessel value per crossing. For a very large crude carrier, that is a quarter of a million dollars per transit. At that price, most shipowners simply stopped sending vessels. Image Source: Zacks Investment ResearchWhere Oil Goes from HereScenario 1: Resolution and De-escalationIf a deal comes out of any upcoming talks and Iran formally reopens the strait, normal traffic can resume.If this happens, expect an immediate drop of $10 to $20 per barrel on a relief trade as speculative long positioning unwinds. But here is what the market is not pricing: supply chain damage, infrastructure destruction, and lingering production outages do not heal overnight.While WTI would likely see a sharp selloff, there would likely be stabilizing in the $75-80 area. That is still a substantial premium to where the year started.Scenario 2: Prolonged StalemateThe ceasefire holds nominally but traffic remains suppressed, and a limbo of sorts sets in as shipping firms continue to avoid the strait. Production from the Gulf states stays constrained and crude oil anchors in the $90 to $110 range.This is arguably where we are right now, and it may persist for months. The political incentives for Iran to fully reopen without meaningful concessions are limited.Scenario 3: Re-escalation.The Islamabad talks collapse and rhetoric gets negative leading to a broken cease fire. Iran formally reimposes a full blockade or escalates attacks on energy infrastructure.In this environment, Goldman Sachs and Barclays have both flagged the potential for a sustained move above $100, with inflation consequences that would redefine the macro environment. Image Source: Zacks Investment ResearchAll three scenarios have real probability attached to them right now. The market cannot price certainty because there is none. What that means for investors is that energy stocks carry a genuine geopolitical option premium that does not exist in any other sector.You are being paid to own the uncertainty.And there is a longer-arc argument that goes beyond the crisis itself. Even if Hormuz reopens tomorrow, we have already experienced how fragile our global energy supply chains are. Capital will flow toward domestic production, toward infrastructure resilience, toward supply security. That is a multi-year tailwind for American energy producers regardless of how this particular confrontation ends.The Stocks to OwnThe XLE energy ETF is up more than 25% year-to-date. The S&P 500 is up roughly 4% over the same period. The XOP exploration and production ETF is up 30%.If you have been sitting in diversified equity exposure waiting for the broader market to recover, you have been in the wrong place. The only place that has outperformed has been speculative AI related names, that can be very volatile and hard to hold.I want to be positioned in three names that have significant upside and limited downside as dividends will support any short-term drop in the actual price of crude oil. Image Source: Zacks Investment ResearchExxonMobil (XOM)Exxon is an anchor of any oil portfolio in this environment, and the numbers back it up. The stock is up roughly 21% year-to-date and has recently hit all-time highs. But this up move is not like chasing a tech stock, because the current fundamentals justify the price action.Exxon’s integrated model is what you want when oil is volatile. Upstream operations generate explosive cash flow when crude prices are elevated. Downstream refining and chemicals provide ballast when prices soften. The Permian Basin production footprint, now exceeding 1.5 million barrels of oil equivalent per day following the Pioneer Natural Resources acquisition, gives Exxon some of the lowest-cost production in the industry.Free cash flow exceeds $40 billion annually even at $80 oil. The company has returned over $36 billion to shareholders in the past twelve months through dividends and buybacks, and has now increased its dividend (still over 2.7%) for 43 consecutive years.The stock is a Zacks Rank #1 (Strong Buy) that has a market cap of $620 billion. Exxon’s next earnings are due May 1 and investors should expect a substantial beat of the $1.21 consensus estimate. The highest analyst price target is $195, implying roughly 30% upside from current levels even after the year-to-date run.The bull case: Oil stays elevated through Q2 and Q3. Exxon’s Guyana offshore expansion and LNG investments begin contributing meaningfully to cash flow. The stock re-rates higher as investors realize the earnings power of this company at $90 plus oil is not fully reflected in a single quarter’s multiple. Image Source: Zacks Investment ResearchEOG Resources (EOG)If ExxonMobil is the integrated fortress, EOG is the pure-play engine. There is a reason people in the industry sometimes call it the Apple of oil. EOG runs its E&P business like a technology company, focusing on efficiency, cost structure, and return on invested capital.EOG has a Zacks Rank of #3 (Hold) and will report earnings on May 5th. The stock has a market cap just over $70 billion and pays a 3% dividend.EOG operates almost exclusively in U.S. shale, which matters in the current environment. American producers are insulated from the direct shipping risks in the Persian Gulf as they do not have tankers sitting at the mouth of the Strait of Hormuz. They benefit from elevated oil prices without bearing the geopolitical exposure that Gulf-dependent producers carry.EOG also runs a shareholder-returns program that combines a base dividend with special dividends tied to cash flow performance. In a high-oil-price environment, those special dividends add up.The bull case: The global supply shock keeps WTI elevated for the next two to three quarters. EOG’s operational discipline means it is capturing every dollar of that price increase at the bottom line without overextending its capital budget. The stock re-rates as investors recognize that a low-cost domestic producer is the cleanest way to own high oil prices without Gulf risk. Image Source: Zacks Investment ResearchBP (BP)BP brings something few peers are as leveraged to: a global trading operation that can turn volatility into earnings.In the current environment, that matters.In April, BP flagged exceptionally strong oil trading results for Q1, driven by the surge in volatility tied to disruptions around the Strait of Hormuz. Production remains broadly stable, but the real story is earnings sensitivity. Analysts have taken notice, with Citi lifting forecasts on stronger trading, while UBS and BNP Paribas both moved more constructively as a new CEO steps in at a pivotal moment.In a high-price, high-volatility tape, BP sees earnings power expand quickly, with both Brent exposure and trading gains flowing directly into cash flow. If oil holds above $90 through mid-year, the setup turns compelling: stronger trading performance, accelerating cash generation, and an opportunity for management to reset the narrative through balance sheet repair and sharper strategic direction.BP has a Zacks Rank of #2 (Buy), a market cap of $120 billion and pays a dividend of 4.2%The bull case: Volatility persists, trading delivers, and BP re-rates as the market recognizes that current pricing embeds more uncertainty than the underlying earnings power justifies. Image Source: Zacks Investment ResearchWhat Could Go WrongThere is of course a downside scenario that would derive from a comprehensive peace deal from the Islamabad talks, combined with Iranian oil flowing freely back into the market. This scenario could knock $15 to $25 per barrel off crude prices in a matter of days, despite any infrastructure issues that were impacted from the war.Markets would start to price in a long-term optimistic view that would compress energy sector earnings estimates and likely trigger a significant rotation out of energy stocks.That risk is real and worth sizing around. But it does not change the fundamental calculus of owning the right names in this sector. Position sizing matters, and trimming into strength is always prudent when a geopolitical catalyst is this binary.In SummaryWe are still in what the International Energy Agency has described as an unprecedented disruption in global oil markets.Some analysts have called it sustained, but I would frame it more simply as “structural”.Even if this specific crisis fades, the market has been forced to reassess how dependent it is on a single critical chokepoint. That tends to favor domestic U.S. producers over time.In the near term, the situation around the Strait of Hormuz remains fluid, and the ceasefire is still fragile. That argues for staying invested in the sector, but being selective about exposure and sizing risk appropriately.Energy is sending a clear signal here. The question is how investors choose to respond.Jeremy Mullin is a stock strategist who combines the fundamental power of the Zacks Rank, technical analysis, and computer driven trading to find the best trades. Discover all his current recommendations in the Commodity Innovators and Zacks Counterstrike Newsletter .

I thought that some of you may benefit from the above analysis.

The post April 2026 Stock and Fund Picks first appeared on MarchéEconomics.

A Schwab market update for March 18 goes like this: (Wednesday market open) With a Federal Reserve decision directly ahead and no rate change anticipated, investors mull another hot Producer Price Index (PPI) report and cast a wary eye at crude oil and the Middle East. Headline February PPI spiked 0.7% compared with the 0.3% consensus. Stocks fell after PPI, and crude steadied amid continued Iranian attacks on Gulf states. Wall Street often treads water heading into rate announcements.

The most dire prediction of the approaching stagflationary recession, which is due entirely to the Trump administration, goes like this: Democratic Party strategist James Carville predicted that President Donald Trump’s tenure will end prematurely, stating that Trump is not long for the presidency because “everything that he tries blows up in his face.” In a Politicon video, Carville made a bold forecast about Trump’s political future. Carville stated, “I’m telling you, I think he’s just going to quit next year by this time. I think he’s just going to walk away because the Democrats control the House and the Senate.” Carville characterized Trump’s position as increasingly untenable, saying, “No one’s going to pay attention to him. The fiscal condition of the country is beyond in the ditch. The Iran thing has turned into just a catastrophe of the first order.”

We will gain insight into which problem the Fed sees as worse, because it can either raise interest rates to combat inflation or lower them to combat slowing growth and rising unemployment. Since we have a dual mandate for our Fed, it must, in the context of stagflation, do one or the other, and obviously, it cannot do both.

An often-used definition of a recession is two or more consecutive quarters of negative economic growth. Thus, we are only on the precipice of a recession and looking down, but we have not actually fallen into the gorge.

For those wanting to look at verified growth stocks, consider: IPGP, ACMR, SANM, AEIS, CGNX, FTV, EFXT, GCT, BODI, TBLA, ITEC, SCHL, ENOV, SHIP, DRD, AUGO, and SANM. For dividends and growth, consider: BHP, RNLSY, SHIP, BGS, QUAD, and UGP. For those going short, consider: ADUX, CLDX, QBTS, PONY, and LB. Over the previous three months, the top ETFs were ranked in order from highest to lowest as: PSI, SOXX, IDGT, SOXQ, and SMH. As always, good investing!

The post March 2026 Stock and Fund Picks first appeared on MarchéEconomics.

The wage growth rate is down significantly from its near-term peak more than 3 years ago (although it is still positive), according to the Atlanta Fed Wage Growth Tracker. Since peaking at 6.7% in 2022, it has steadily declined to 3.7% in early 2026. Wage growth is an important factor for a number of reasons, including as a component of economic growth and overall inflation.

Source: Federal Reserve Bank of Atlanta, Current Population Survey, Bureau of Labor Statistics and author’s calculations, as of February 15, 2026. Note: October 2025 data not collected by the Bureau of Labor Statistics.

Although Trump’s immigration policies have removed workers from the labor force and, depending on the level of unemployment within that group, may have prevented the unemployment rate from rising as fast, it appears there are also fewer jobs available. Thus, the reality is fewer jobs and lower pay. The main reason for this is Trump’s protectionist tariff policies. These same policies are behind the sudden jump in the producer price index (or PPI) to 0.5% in its latest reading. The PPI is forward-looking and represents price increases in the pipeline. By contrast, the consumer price index (CPI) is backward-looking and measures prices from a month or so earlier. The inflationary buildup and slowing growth rate (also recently reported) are consistent with a slowly developing stagflationary recession.

The current administration appears to be on a taxing (tariffs) and spending path that most Democrats would envy. Republicans supporting such policies along with the administrations political posturing reminds one of the politicians supporting France’s Vichy government during WWII that accommodated the Nazi’s. Such politicians could not be said to be on the side of Eisenhower, or in any way be considered Republicans. I guess if you were completely in the dark or totally uninformed you could be like Archie Bunker and praise Herbert Hoover (remember the All in the Family Theme Song) in a way that MAGA “Archie Bunker’s” praise Trump. I think we have to have relatively uniformed people in government to get where we are today. Luckily, the Supreme Court has finally come around and ruled that Trump’s tariffs are unconstitutional. This could be a great help.

Given that we continue to slide downhill economically. We are not yet in recession and investing is still on the table. Going long on growth stocks, one might consider: SANM, ORLA, SNEX, HRMY, EZPW, PAX, HLF, ARW, CRUS, CGEMY, DLX, and FSM. This approach should be accompanied with a build up of cash should a sudden pull-back or sell-off occur. One could also consider some stocks to short: SMR, LB, CCI, REXR, SMA, IRT, ARI, BMI, and ADUR comprise a list of candidates. For those wanting to retire in the distant future, some dividend growth stocks include: TIMB, BNPQY, BTI, CRRFY, MITT, OHI, PLTK, POR, SVNLY, USAC. The top ETFs are: XLI, XLE, XLB, XLU, and XLK. As always, Good Investing!

The post February 2026 Stock and Fund Picks first appeared on MarchéEconomics.

The Conference Board Employment Trends Index (ETI) Declined in December

Latest Press Release

Updated: Monday, January 12, 2026

The Conference Board Employment Trends Index (ETI) declined in December to 104.27, from a downwardly revised 104.64 in November. The Employment Trends Index is a leading composite index for payroll employment. When the Index increases, employment is likely to grow as well, and vice versa. Turning points in the Index indicate that a change in the trend of job gains or losses is about to occur in the coming months.

“The ETI slid further in December, reflecting low labor market confidence in the outlooks for hiring and job-finding,” said Mitchell Barnes, Economist at The Conference Board.

On top of this, Trump added tariffs to pressure some European countries over Greenland. This is like shooting US growth in the foot because it will only add to the headwinds slowing economic growth and labor market hiring. To be clear, we are not yet in a stagflationary recession but in more of an economic slowdown or “mild stagnation.” Inflation may get help from productivity increases in AI and stable oil prices, but this effect will be offset by supply disruptions and cost increases for consumers and producers that result from more tariffs. Also, health care costs are on the increase and will show up in inflation indexes as well. Thus, the stagflation monster is thinking about huffing and puffing at the door while Trump’s better jobs and higher wages have long disappeared from reality.

Within this context I have a few decent stocks and funds to recommend, while at the same time recommending caution and the accumulation of savings to be used during a possible market sell-off. For growth consider: F, PROP, SWKS, AAUC, HTH, ARMN, ADEI, EVER, NXGPY, ANGO, BDTX, TKAMY, FIVN, SKWD, DG, ARRY, TX, AUGO, ARTC, CGAU, KGC, REVG, ILPT, GM and TRUP. For dividends and growth: BNPQY, CRRFY, SUN, F, PAA, TIMB, CTO, MBGYY and SWKS. During the previous three months the ETFs with the highest growth rates were: PSI, SOXX, SOXQ, SMH and KBE.

For those interested in CEFs for income and portfolio growth there are two main categories. For taxable investment portfolios consider: ETB, ETV, ETW, EVT, BXMY, DIAX, QQQX, HTD, PDT, PML and FLC. For tax sheltered portfolios such as 401Ks that are subject to RMDs consider: BTX, BST, BSTZ, NBXG, RLTY, JRS, PGZ, DFG, ZTR, MEGI, HQH, HQL, BME, BMEZ, ECF, BCV, NCV and NCZ. Keep in mind that CEFs tend to preserve there NAVs and will lower their dividends during a recession in order to do so. Also, the market price of a fund can differ from its NAV. All funds suggested are priced at a discount to their NAVs and may tend to increase in value as a result. As always, good investing!

The post January Stock and Fund Picks first appeared on MarchéEconomics.

“The US LEI fell again in September, marking a second consecutive decline,” said Justyna Zabinska-La Monica, Senior Manager, Business Cycle Indicators, at The Conference Board. “Weakening expectations from consumers and businesses led the overall contraction in the Index. Subindexes that contributed negatively to the LEI were consumer expectations and ISM® New Orders Index, followed by manufacturers’ new orders of consumer goods & materials, initial claims for unemployment Insurance (inverted), and the yield curve. However, stock prices, the Leading Credit Index, and manufacturers’ new orders of nondefense capital goods excl. aircraft did contribute positively to the Index. The LEI suggests slowing economic activity at the end of 2025 and into early 2026, with GDP weakening after strong mid-year consumer spending and Q4 disruptions amid the federal government shutdown. Overall, growth remains fragile and uneven as businesses adjust to tariff changes and softer consumer momentum. The Conference Board expects GDP to expand by 1.8% in 2025, before falling to 1.5% in 2026.” 

Like the post pandemic period when the FED thought that inflation was only transitory and then corrected itself in order to bring inflation down by repeatedly raising the discount rate and Federal Funds rate target, I expect it is wrong again that inflation won’t be another longer-term problem. Most firms have front ran expected tariffs by purchasing inventory before the tariffs hit but are now faced with either contracting margins and falling profits, or they must pass the tariffs on to consumers. On top of that, increasing health care costs will soon show up in the price indexes. The bottom line is that we have a ways to go before we see the end of slower growth and inflation.

I would continue to invest with caution. Some well researched growth, dividend, and ETF recommendations include the following: For growth you should consider: NRDS, HRTG, KGC, KROS, ANIP, CGAU, BVN, NEM, AEM, and AGX. For dividends and growth: CION, CWENA, APAM, CNQ, TIMB, ENGY, PINE, and PSTL. The previous three months saw the following five ETFs greatest percentage gains in market value: PSI, SOXQ, SOXX, SMH, and VHT. The first four ETFs are all in the semiconductor space.

As always, good investing!

The post December Stock and Fund Picks first appeared on MarchéEconomics.

As we slowly slide into a more distinctive stagflationary scenario resulting from an internal supply-side shock caused by increased tariffs, the Fed is increasingly uncertain as to whether it should focus on the deteriorating economy through interest rate cuts, or the increasing inflationary outlook through interest rate increases. Recently, it has focused on the deteriorating economy while at the same time lamenting it’s inability to simultaneously address tariff caused inflation. (By contrast, the Fed can directly fight a demand-side induced, deflationary recession by decreasing rates and increasing the money-supply.)

Given the weakened state of the economy caused by Trump’s tariffs and the resulting supply-chain disruptions, it appears best to generally stay invested to capture any possible market upside while simultaneously reducing downside exposure. The rationale is that we cannot say with certainty the the market is in an overbought or AI bubble, but recent NVIDIA earnings suggests that the AI bubble worries may be a bit overblown. Instead, the psychological FOMO phenomena is probably the mistake most investors should concern themselves with. Instead of FOMO investing, the action to take now is to gradually begin rotating out of your aggressive holdings in equities and any investments that use high amounts of leverage. Also, consider rotating into investment grade fixed income investments and increasing your cash balances. For cash balances, I would suggest a fund like BOXX, for example.

If you still want to buy equities, focus on those that are highly rated such as: ARMN, TREE, SANM, CRMD, SNDK, NRDS, UNFI, HRTG, and KROS, for example. For those wanting solid investments with dividend growth, consider: CION, TIMB, AEG, APAM, BAP, LAZ, PINE, and POR. For those wanting to know the 5 best performing ETFs over the previous three months, this list is comprised of: SHOC, SMH, VHT, XLV, and PTF. As always, good investing!

The post November Stock and Fund Picks first appeared on MarchéEconomics.

Because I have a Ph.D. in economics and a much vaster knowledge base in the areas of this subject, I can make predictions that will happen in the future with a high degree of accuracy. Also, since cause and effect happen with considerable lags most of my predictions refer to around six to twelve months in the future. So, if you want to know the current state of the economy, just read what I said six to twelve months in the past. Tariffs (taxes) have led, as predicted, to increasing inflation and decreasing growth, or “stagflation.” That is why the Fed remains so cautious and states that focusing on either inflation or the wobbly labor market has risks going forward. The Fed can only fight a demand side recession that, because of a reduction in consumer spending, is both deflationary and has a declining GDP. Simply increasing the money supply, signaled by decreasing the discount rate, remedies the situation . . . but with a lag, of course. Trump’s tariffs cause a supply-side or supply-chain disruption that leads to both stagnation or slowing growth and rising unemployment and inflation. If the Fed targets unemployment buy lowering rates it makes inflation worse. If the Fed targets inflation by raising rates it make unemployment worse. If Trump succeeds in pressuring the Fed for lower rates, we will most certainly face much higher inflation. This will lead to higher, not lower, long term interest rates and less domestic investment as a result. There is no simple serendipitous scenario credited to the simpletons who think that if Trump just gets his way we will be better off.

On a different topic. Trump’s narcissistic personality disorder is characterized by, among other things, a strong proclivity to respond positively to praise and react very negatively to criticism. His personality disorder makes him subject to manipulation by Putin who praises him and to an inability to handle any kind of criticism or negative news. Thus, his decisions seem irrational when, instead, the are the result of a disorder. Investors will have to take Trump’s personality disorder into consideration as it could lead to much greater uncertainty going forward. Investors in gold have already done this. You should to. For example, I would strongly consider a fund like IAUI as a way to generate income and take advantage of Trump’s personality disorder through rising gold prices. As always, good investing!

The post September Update first appeared on MarchéEconomics.

Election cycle theory suggests that the negative effects of Trump’s tariff policy will not fully set in until the beginning of next year. Thus, we can expect that the stock market will remain on relatively steady footing until then. On the other hand, Trump’s fight with Fed chair Powell has some very negative ramifications. First, Fed policy independence is being threatened by Trump. Firing Powell would send the stock market into turmoil and could cause a complete collapse in the short-run. The longer run is a bit more complicated but rests on the fact that the ECB just decided to keep interest rates the same due to tariff uncertainty.

In the U.S., Fed chair Powell has also kept interest rate reductions on hold due to tariff uncertainty and the increase in the inflation rate that is already underway due to tariffs. Trump still thinks he wants lower rates, however. Here is what happens if Trump gets his way. The Fed only controls short-term rates via the discount rate that it sets directly and the targeted federal funds rate. The discount rate is the interest rate the Fed charges member banks that need to borrow cash reserves to meet their legal reserve requirements on checking deposits. The slightly lower federal funds rate is the overnight rate charged by banks that want to lend their excess reserves to other banks to meet their reserve requirements. Lowering the discount rate causes the Fed to increase excess reserves or monetary liquidity into the banking system so as to reduce the targeted federal funds rate. More liquidity, in turn, pushes up prices and the inflation rate.

In the bond market, the real return on a bond is the nominal interest rate received by the bond holder minus the expected inflation rate. When the expected inflation rate increases due to lower short-term interest rates and increased monetary liquidity, bond holders must demand higher nominal rates so as to maintain the same real return on bonds. Consequently, existing bond holders will tend to sell their existing bonds and drive up the nominal interest rate. This happens because bond values and their corresponding nominal interest rates are inversely related. Thus, short-term rate reductions will increase interest rate expectations and longer term market interest rates in the bond market.

Some consequences of higher longer term interest rates are less private investment by home purchasers and corporations. This will increase unemployment along with the higher inflation rates. I think this is just the opposite of what Trump wants, but it just means that Trump does not understand basic economics.

Given that the economy is threatened by both tariff and monetary policy risks but effected positively by election cycle theory, one can make the argument for investing cautiously until 2026. Some growth stocks to consider are: APEI, PAAS, AU, HMY, KROS, KGC, STKL, B, and FUTU. Dividend growth stocks include: ACRE, APAM, BSET, CRGY, KGS, PAGP, TROW, VOD, and ARLP. For the previous three months, the five fastest growing ETFs were: SMHX, SHOC, SMH, TRFK, and FTEC. As always, good investing!

The post July 2025 Stock and Fund Picks first appeared on MarchéEconomics.

The third area of relative value is comprised of non-US developed economy equities. International growth rates remain at risk do to tariffs, however. So investing in this area carries the most risk. Funds such as FEZ, SCHF, EWC, and EWA are among those to take a look at. Invest according to your own appetite for risk. As always, good investing!

The post June Stock and Fund Picks first appeared on MarchéEconomics.