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While the media and most of the market experts have hyperventilated about the recession that is “right around the corner”, the stock market (as measured by the S&P 500 Index) has increased by 14.6% so far in 2023.

Linda Duessell, Equity Strategist at Federated Hermes said:

“The First half (of 2023) was a consensus killer; The economic data kept surprising to the upside, particularly jobs and consumer spending. Stocks rallied. Volatility fell…growth strategies outperformed.”

It seems we are constantly reminding our clients not to pay attention to the “experts” in the media. Here is what we offered in our January letter:


“I have repeatedly warned anyone who will listen to me that the “Wall Street Consensus” is rarely correct. We have charts and graphs which document that often you are better off ignoring the “consensus”. Unfortunately, one of my most respected market strategists, Scott Minerd, passed away just before Christmas at age 63. Minerd was never afraid to speak out even when his view differed from the crowd. He said:

“As an asset manager, I’ve come to view conventional wisdom as the surest path to investment underperformance.”

Even though the crowd continues to warn of a dreadful recession, there are currently a few strategists that are not falling in line with the crowd, believing that the worst may be behind us. That is not what the media would have you to believe…they rarely let reality get in the way of a good story…they prefer to generate hysteria when they can. We attempt to read enough so that we also understand the other side of the story”.

The Bulls and the Bears are always in a tug-of-war, and we have found after many years of market watching that buying a well-diversified portfolio of high-quality stocks in companies with strong competitive advantages and holding them for a very long time is the time-tested practice of many very successful investors. Warren Buffett is the most famous example of this strategy, and it is the strategy that we have found works best for clients of Aspen Grove Asset Management.


No, it has not “dropped like a rock” like we predicted in our April letter, but today’s 3% Consumer Price Index Report is a huge step in the right direction. Compared to the 9% inflation we were facing a year ago, 3% looks very good. Raymond James Economist Eugenio Aleman also explains:

“as the report indicates, shelter costs (rents) remained strong during the month and represented more than 70% of the increase in the monthly index. This means that if, as we expect, shelter costs start to weaken considerably during the second half of the year, the prospects for much lower inflation readings are looking promising.”

After today’s report, the Feds goal of a “soft landing” is looking even more promising.


Several reports in recent weeks suggest that China’s recovery from the Covid shutdown is much weaker than had been widely expected. You might remember that several months ago (October 2021 Crouch Connection) we suggested that the property bubble in China could be a much bigger problem than what the US faced in 2008.

An article yesterday in the Wall Street Journal sub-titled “Warning signs are adding up that China might face a slow, post-2008 style U.S. recovery” stated:

“China’s housing market is weakening again. The value of contracted sales for China’s top 100 property developers fell 28% from a year earlier in June…China probably won’t slip back into a formal recession. But, like the U.S. after the 2008 financial crisis, it may be facing a scenario where households and companies refuse new borrowing due to existing heavy debts—and a lack of confidence about the future. Instead, they use new income to pay down existing obligations. That in turn makes it difficult for policy makers to goose the economy with lower interest rates, because the pass-through to actual new investment and consumption is marginal.”


China’s economy has a huge impact on the supply and demand of almost everything we need to keep the US economy and consumers moving. When China slows down, oil prices ease, gasoline prices often drop, diesel and aviation fuel become more affordable (for individuals and the transportation industry). Copper, steel, and other commodity prices usually come down. In other words, inflation ceases to be a problem.

Another factor directly affecting US consumers is China’s population decline. Because of their one child per family rule for many years, their population has begun to fall, not grow. Japan has been battling the same problem for many years, and their economy has been in the doldrums as a result, so expect to see more news in the future about China’s struggling economy. Again, this will take more pressure off of US inflation.


We continue to believe well-diversified portfolios are the best protection against inflation. 2023 has not yet rewarded our dividend-heavy portfolios as the bulls and bears are still fighting that battle, but we believe the pendulum will swing back to the dividend income portfolios as it has in the past. Call us “cautious bulls” at Aspen Grove Asset Management.

We welcome your calls if you need encouragement. Always give us a call if we can assist in any way.


Dave Crouch Kim Blackburn Kay O’Connell

Registered Principal Branch Operations Manager Financial Advisor

Financial Advisor

Buffet Quote:

"For 240 years it's been a terrible mistake to bet against America, and now is no time to start."

The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material nor is it a recommendation. The information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing material is accurate or complete. Any opinions are those of Dave Crouch and not necessarily those of Raymond James. Expressions of opinion are as of this date and are subject to change without notice. There is no guarantee that these statements, opinions or forecasts provided herein will prove to be correct. Investing involves risk and you may incur a profit or loss regardless of strategy selected. Past performance does not guarantee future results. Future investment performance cannot be guaranteed, investment yields will fluctuate with market conditions. Securities offered through Raymond James Financial Services, Inc., member FINRA/SIPC. Investment advisory services are offered through Raymond James Financial Services Advisors, Inc. Aspen Grove Asset Management is not a registered broker/dealer and is independent of Raymond James Financial Services.


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