Stocks Are in All-Time-High Territory Again

Some things never change... The market loves the idea of rate cuts... Back in all-time-high territory... The writing is on the Fed's 'dot plot'... Don't forget the risks... One factor that could keep inflation higher for longer... [Stansberry Research Logo] Delivering World-Class Financial Research Since 1999 [Stansberry Digest] Some things never change... The market loves the idea of rate cuts... Back in all-time-high territory... The writing is on the Fed's 'dot plot'... Don't forget the risks... One factor that could keep inflation higher for longer... --------------------------------------------------------------- The juice is back... All it took for the major U.S. stock indexes to get back near all-time highs for the first time in nearly two years was the mere idea that the Federal Reserve would cut interest rates... This was the case [yesterday]( when Fed officials kept the central bank's benchmark lending rate steady, as it has been since July, and then penciled three 25-basis-point rate cuts into their projections for 2024... In a press conference that followed the Fed's latest policy announcement, Chair Jerome Powell went from sounding like the ghost of Paul Volcker to more like... well... the Jerome Powell of old, before inflation hit a 40-year high. He had multiple opportunities to dispute the idea that rate cuts would be coming next year. But he didn't come close to doing it. Every time a reporter brought up the subject in a question – "rate cuts" – he didn't question or push back on the possibility like he has done so many times before. The stock indexes screamed higher on the Fed's announcement and took an extra leg up as Powell spoke afterward. They also continued moving higher into yesterday's close... The Dow Jones Industrial Average closed Wednesday at a new all-time high – crossing 37,000 for the first time – and moved higher again earlier today... while two of the other three widely followed indexes are sniffing similar new all-time-high levels. Some things never change – even with the inflation 'fight' not yet formally declared over... Powell and company gave the markets a hit of juice, just like the good old days before 2022. A slight uptick in unemployment, as we've been reporting on, was enough to spur this apparent "dovish" turn from the Fed. As Powell said yesterday in response to a question about how the Fed will know that it's not "behind the curve" on cutting rates, as it was on raising them two and three years ago as inflation accelerated... We're aware of the risk that we would hang on too long [to higher rates]. We know that that's a risk, and we're very focused on not making that mistake... We've come back into a better balance between the risk of overdoing it and the risk of underdoing it. Then he referenced the Fed's dual mandate from Congress of promoting "price stability" and "maximum employment." As we've been reporting, the government's "official" inflation numbers have been showing for months that inflation is returning to "normal" levels. Meanwhile, the unemployment rate has been ticking higher (though it fell in November). Powell said... We were able to focus hard on the price stability mandate, and we're getting back to the point where... both mandates are important, and they're more in balance, too. He said the focus on slowing inflation is not as important anymore, without really saying it. That's a big turn from Powell's past proclamations that the central bank would address inflation "until the job is done." The writing is on the wall, or more specifically, the Fed's 'dot plot'... This inflation fight is over, as far as the Fed is concerned. Is that really the case? Could the pace of inflation unexpectedly rebound if the economy remains "stronger than expected," as he was asked yesterday? Sure. Today, for example, data from November showed retail sales in the U.S. continuing to grow. In the case of a stronger-than-expected economy ahead, Powell said... That could mean we need to keep rates higher for longer. It could even mean, ultimately, that we would need to hike again. We will eventually find out, but the overall message now from the U.S. central bank is that it's turning from inflation-fighting mode to economy-preserving mode. As we said yesterday, [the Fed's thinking is clear if you read the "dot plot"]( – a spread that charts the members' policy projections. It spells out a course that would take the federal-funds rate to 2.9% sometime in 2026. And that has the major U.S. stock indexes flying higher... The Dow Jones Industrial Average has already made a new all-time high. The S&P 500 Index made a new 52-week high yesterday – which put it up roughly 23% for the year – and closed within 2% of its all-time closing high on January 3, 2022, before the start of the bear market. It's a similar story with the tech-heavy Nasdaq Composite Index, which is up about 40% year to date and is roughly 8% from its previous high in November 2021. The small-cap Russell 2000 Index has further to go to reach new heights, still off about 20% from its all-time high in November 2021. So if you're looking for a place to "catch up" should current trends continue, small caps would be it. Momentum has been in favor of the bulls for a while now, as [we wrote in the November 28 edition](. The trend can continue... but also remember that eventually, history suggests that the "bad news" in the economy that's leading the Fed to suggest it might be cutting rates next year first leads to a haircut for stock prices before things get better. Moving on, time is winding down to hear our friend Joel Litman's latest message... Last week, Joel – founder of our corporate affiliate Altimetry – debuted a brand-new free video event in which he primed viewers for what he expects to be a "brutal" period for the markets in early 2024. [You can watch it here](. While he's not suggesting folks should go "all out" of stocks, he is saying that you should be tactical in any buys and holds today because, frankly, the conventional metrics Wall Street uses to gauge the real value of a business often come up short. Joel knows. He's a world-renowned "forensic accountant," who has consulted for the likes of the FBI and Pentagon in addition to Wall Street clients. You may be thinking, "Why would a stock analyst be asked to do such a thing by those institutions?" Well, Joel's expertise goes beyond spotting great stocks... If you've ever heard him give a talk – at our annual Stansberry Research conference, for instance – you know he has got his finger on the pulse of major macroeconomic trends influencing the global financial world. On [a recent episode of the Stansberry Investor Hour podcast]( my friend and co-host Dan Ferris asked Joel how he arrived at his bearish view on the market today. Joel spoke about valuations and earnings expectations being revised down constantly and also issues he sees around the world... Every continent, whether you're talking about Germany pulling down the EU, China pulling down Asia and the world, Latin America where you got multiple countries in deep recession and hyperinflation, you put all this stuff together, there's no way you could say that we've got any kind of growth. Earnings growth is limited. Here in the U.S., Joel says it's going to take time to redesign global supply chains to cut out China and Russia. Companies are spending "like crazy" to make it happen, which is going to bring down free cash flow for companies making these ongoing investments. Another consequence of rejiggering the global supply chain is higher inflation... As Joel said, he's not convinced high inflation is dead yet... When you hear supply-chain discussions [from] CEOs, they're all talking about supply-chain resiliency, protection, whatever. Every time you hear that, you have to think, "Stuff is going to get more expensive." You're going to have rising prices, and that is going to contribute to these inflation issues that Powell is trying to fight, and I don't know that he's got all the tools in the box to fight it. He's doing what he thinks is right, which is going to lead to certain consequences in terms of a recession, but I don't think he's going to solve the issue. The only solution is going to take years. We will have a better supply chain that won't be as dependent on certain markets that people are worried about, like China, but it's going to take a while to get those efficiencies back in the system, and that means things are going to cost more. It's not going to be fixed next year by any means. So, anyway, check out Joel's latest message. In it, he is joined by Marc Chaikin, founder of another of our affiliates, Chaikin Analytics, as they discuss how they've combined forces to come up with a portfolio of "perfect" stocks worth owning right now – even with trouble ahead for the economy that Joel is predicting. Together, Joel and Marc identified 164 stocks over more than a decade that would have met their definition of perfect. On average, these stocks returned four times the S&P 500. As [I wrote last week]( after the debut of the event, which was watched by thousands... Plus, not only would following this strategy get you into the right stocks at the right time, but it would also keep you out of the wrong stocks. As Joel says, this is an important thing to think about all the time... but especially now, as his analysis is warning of a recession next year. Yet Joel also said that even if a recession hits, you can't afford to be out of stocks. He shared a stunning chart showing the difference in returns if you hold stocks through a recession versus trying to avoid them or staying completely out of the market in cash. But he strongly recommends you own the "perfect" stocks to protect and grow your wealth. As Joel told us on the podcast, he wouldn't be buying the S&P 500 right now, but "very specific stocks in very specific pockets" that are going to benefit from things like the supply chain's reengineering and massive shifts in global manufacturing and industrial trends. Get all the details in the video. It's totally free, and just for watching you'll get four free recommendations – two buys and two sells. [You can watch it here](. Finally, today, I want to give you a heads-up about tomorrow's edition... Our offices will be closed tomorrow as our company celebrates the holiday season, and Dan has the week off from writing... but you will still receive the Digest tomorrow after the market closes. It will be a special essay from our founder Porter Stansberry, whom longtime subscribers will know delivered epic Friday essays in this space for years, after writing the Digest every day in the years before that. So, stay tuned to your inbox tomorrow evening. I can tell you that you'll hear Porter's thoughts on the Fed and how he suggests folks prepare for the inevitable crisis that the central bank has likely already set in motion. Plus, you'll have the opportunity to get fully up to speed on where Porter has been these past few years and what he is up to now in a brand-new video that our colleague Dr. David "Doc" Eifrig recently recorded with Porter. Stay tuned. Why Companies Are Now Afraid of Political Correctness Whitney Tilson – the new lead editor of our flagship Stansberry's Investment Advisory – joined me and Dan on the Stansberry Investor Hour, and we couldn't avoid talking about how the political and cultural issues of the day are influencing corporations' actions – and bottom lines in some cases... [Click here to listen]( to this interview right now. For more free video content, [subscribe to our Stansberry Research YouTube channel](... and don't forget to follow us on [Facebook]( [Instagram]( [LinkedIn]( and [X, the platform formerly known as Twitter](. --------------------------------------------------------------- Recommended Links: [Severe Stock Warning: Sell Your Stocks by January 1, 2024?]( It doesn't matter if you have money in the markets or you're waiting on the sidelines right now. The early days of 2024 could have the power to make – or destroy – fortunes. And what you do with your money before January 1 could determine your wealth for the next decade. [Here's what's happening and how to prepare](. --------------------------------------------------------------- [Must See: Subscriber's Viral Holiday Video]( Have you seen this holiday message from one of your fellow subscribers yet? He retired early thanks to ONE investing idea that doesn't involve stocks... options... or cryptocurrencies. And he has continued enjoying retirement – worry-free – right through all of the volatility of the past year. The secret? A simple strategy for seeing double-digit annual income... AND triple-digit capital gains... with legal protections (even in an economic crisis). [Click here for his new holiday message](. --------------------------------------------------------------- New 52-week highs (as of 12/13/23): Apple (AAPL), ABB (ABBNY), Autodesk (ADSK), Advanced Micro Devices (AMD), Amazon (AMZN), A.O. Smith (AOS), Brown & Brown (BRO), Costco Wholesale (COST), Cintas (CTAS), CyberArk Software (CYBR), D.R. Horton (DHI), Electronic Arts (EA), Enstar (ESGR), iShares MSCI Spain Fund (EWP), Fidelity National Financial (FNF), Home Depot (HD), Huntington Ingalls Industries (HII), Intercontinental Exchange (ICE), ICON (ICLR), Iron Mountain (IRM), iShares U.S. Aerospace & Defense Fund (ITA), JPMorgan Chase (JPM), KraneShares MSCI Emerging Markets ex China Index Fund (KEMX), Kinross Gold (KGC), Lennar (LEN), London Stock Exchange Group (LNSTY), Micron Technology (MU), NVR (NVR), Palo Alto Networks (PANW), Parker-Hannifin (PH), PulteGroup (PHM), ProShares Ultra QQQ (QLD), Qualys (QLYS), Rithm Capital (RITM), Construction Partners (ROAD), Roper Technologies (ROP), Invesco S&P 500 Equal Weight Technology Fund (RSPT), SentinelOne (S), Sprouts Farmers Market (SFM), Sherwin-Williams (SHW), VanEck Semiconductor Fund (SMH), S&P Global (SPGI), Spotify Technology (SPOT), SPDR Portfolio S&P 500 Value Fund (SPYV), ProShares Ultra S&P 500 (SSO), Stellantis (STLA), StoneCo (STNE), Visa (V), Vanguard Short-Term Corporate Bond Fund (VCSH), Vanguard S&P 500 Fund (VOO), Waste Management (WM), and Zoetis (ZTS). In today's mailbag, thoughts on the challenges facing the Chinese economy, which we talked about in [yesterday's Digest]( and a hypothesis about our mailbag, which was "quiet" yesterday... Do you have a comment or question? As always, e-mail us at feedback@stansberryresearch.com. "Let me see... a bunch of young Chinese males who can't find a job, ~21%, or a wife... what could possibly go wrong with this scenario? How about embracing a nationalistic fervor to supplant the normal desires for 'worth' or 'brotherhood'? That smells a lot like history, or revolution, or imperialism, or expansionism. Think Taiwan implications." – Subscriber Shawn M. "Is there any correlation between your 52-week high list and the amount of feedback you receive? When stocks are all hitting highs, is there less commentary/complaining? Maybe a promising 'real-life' indicator of bullishness vs. bearishness? "Great wrap of the day's events! Thanks for all that you do!" – Subscriber Beau E. Corey McLaughlin comment: Thanks for the note, Beau. I haven't noticed a steady correlation between market performance and the frequency or tone of notes we receive – I would posit that mostly depends on the topics we're covering – but it's an interesting thought and I like where your head is at. Happy holidays. All the best, Corey McLaughlin Baltimore, Maryland December 14, 2023 --------------------------------------------------------------- Stansberry Research Top 10 Open Recommendations Top 10 highest-returning open positions across all Stansberry Research portfolios Stock Buy Date Return Publication Analyst MSFT Microsoft 11/11/10 1,284.6% Retirement Millionaire Doc MSFT Microsoft 02/10/12 1,183.7% Stansberry's Investment Advisory Gula ADP Automatic Data Processing 10/09/08 866.0% Extreme Value Ferris wstETH Wrapped Staked Ethereum 02/21/20 771.1% Stansberry Innovations Report Wade WRB W.R. Berkley 03/16/12 654.8% Stansberry's Investment Advisory Porter BRK.B Berkshire Hathaway 04/01/09 541.9% Retirement Millionaire Doc HSY Hershey 12/07/07 460.0% Stansberry's Investment Advisory Porter AFG American Financial 10/12/12 415.0% Stansberry's Investment Advisory Porter BTC/USD Bitcoin 01/16/20 379.0% Stansberry Innovations Report Wade PANW Palo Alto Networks 04/16/20 339.2% Stansberry Innovations Report Engel Please note: Securities appearing in the Top 10 are not necessarily recommended buys at current prices. The list reflects the best-performing positions currently in the model portfolio of any Stansberry Research publication. The buy date reflects when the editor recommended the investment in the listed publication, and the return shows its performance since that date. To learn if a security is still a recommended buy today, you must be a subscriber to that publication and refer to the most recent portfolio. --------------------------------------------------------------- Top 10 Totals 4 Stansberry's Investment Advisory Porter 3 Stansberry Innovations Report Engel/Wade 2 Retirement Millionaire Doc 1 Extreme Value Ferris --------------------------------------------------------------- Top 5 Crypto Capital Open Recommendations Top 5 highest-returning open positions in the Crypto Capital model portfolio Stock Buy Date Return Publication Analyst wstETH Wrapped Staked Ethereum 12/07/18 1,701.2% Crypto Capital Wade ONE/USD Harmony 12/16/19 1,111.4% Crypto Capital Wade POLYX/USD Polymesh 05/19/20 1,059.7% Crypto Capital Wade BTC/USD Bitcoin 11/27/18 1,045.3% Crypto Capital Wade MATIC/USD Polygon 02/25/21 860.3% Crypto Capital Wade Please note: Securities appearing in the Top 5 are not necessarily recommended buys at current prices. The list reflects the best-performing positions currently in the Crypto Capital model portfolio. The buy date reflects when the recommendation was made, and the return shows its performance since that date. To learn if it's still a recommended buy today, you must be a subscriber and refer to the most recent portfolio. --------------------------------------------------------------- Stansberry Research Hall of Fame Top 10 all-time, highest-returning closed positions across all Stansberry portfolios Investment Symbol Duration Gain Publication Analyst Nvidia^* NVDA 5.96 years 1,466% Venture Tech. Lashmet Microsoft^ MSFT 12.74 years 1,185% Retirement Millionaire Doc Band Protocol crypto 0.32 years 1,169% Crypto Capital Wade Terra crypto 0.41 years 1,164% Crypto Capital Wade Inovio Pharma.^ INO 1.01 years 1,139% Venture Tech. Lashmet Seabridge Gold^ SA 4.20 years 995% Sjug Conf. Sjuggerud Frontier crypto 0.08 years 978% Crypto Capital Wade Binance Coin crypto 1.78 years 963% Crypto Capital Wade Nvidia^* NVDA 4.12 years 777% Venture Tech. Lashmet Intellia Therapeutics NTLA 1.95 years 775% Amer. Moonshots Root ^ These gains occurred with a partial position in the respective stocks. * The two partial positions in Nvidia were part of a single recommendation. Editor Dave Lashmet closed the first leg of the position in November 2016 for a gain of about 108%. Then, he closed the second leg in July 2020 for a 777% return. And finally, in May 2022, he booked a 1,466% return on the final leg. Subscribers who followed his advice on Nvidia could've recorded a total weighted average gain of more than 600%. You have received this e-mail as part of your subscription to Stansberry Digest. If you no longer want to receive e-mails from Stansberry Digest [click here](. Published by Stansberry Research. You’re receiving this e-mail at {EMAIL}. Stansberry Research welcomes comments or suggestions at feedback@stansberryresearch.com. This address is for feedback only. For questions about your account or to speak with customer service, call 888-261-2693 (U.S.) or 443-839-0986 (international) Monday-Friday, 9 a.m.-5 p.m. Eastern time. Or e-mail info@stansberryresearch.com. Please note: The law prohibits us from giving personalized financial advice. © 2023 Stansberry Research. All rights reserved. Any reproduction, copying, or redistribution, in whole or in part, is prohibited without written permission from Stansberry Research, 1125 N Charles St, Baltimore, MD 21201 or [stansberryresearch.com](. Any brokers mentioned constitute a partial list of available brokers and is for your information only. Stansberry Research does not recommend or endorse any brokers, dealers, or investment advisors. Stansberry Research forbids its writers from having a financial interest in any security they recommend to our subscribers. All employees of Stansberry Research (and affiliated companies) must wait 24 hours after an investment recommendation is published online – or 72 hours after a direct mail publication is sent – before acting on that recommendation. This work is based on SEC filings, current events, interviews, corporate press releases, and what we've learned as financial journalists. It may contain errors, and you shouldn't make any investment decision based solely on what you read here. It's your money and your responsibility.