Earnings & Guidance! Issachar Update: I purchased more growth stocks last week as earnings and guidance continue to come in better than expected! Good guidance is when a company anticipates better earnings/sales and a higher stock price, and that has dominated this earnings season. Our stocks are positioned to benefit from the Artificial Intelligence (AI) revolution that has been the catalyst for driving stocks higher since June 2023. I expect the uptrends to continue as more sideline money (5% money markets) joins the party, forcing the indexes higher. A rising tide (indexes) lifts all boats (stocks). The uptrend will last until it doesn’t, and the charts will tell us when it is time to rein in our bullish horns. For now, let’s enjoy the ride while on offense because the trend will change, and defense will need to take the field. Issachar is a mutual fund, actively managed like a hedge fund. (There is no guarantee that any investment will achieve its objectives, generate positive returns, or avoid losses.)
Market Update: The Fed hinted that rate cuts are off the table for March, and the market dropped -1.5% on Wednesday! However, the market bounced back into Friday’s hot jobs report, indicating the economy may get its soft landing. I do not put much weight into the government’s consistently adjusted/revised/manipulated numbers, but the market seems to like what it sees, so I will look away and focus on the charts. Price and volume charts do not lie; that is all that matters when buying and selling stocks. Everything known is already in the price of a stock, and price is the only thing that pays.
The Fed’s preferred measure of inflation (Core PCE) dropped to 2.9% in December, the lowest since March 2021. A Fed Funds Rate at 5.4% is far above 2.9% inflation, which has been the most restrictive monetary policy since September 2007, so the Fed has room for several rate cuts. Higher rates hurt economic growth, and Jay Powell wants to be reappointed in 2025, so he will do his best to lower rates and maintain the status quo in the Whitehouse.
The Treasury expects to increase the national debt by a whopping $760 billion this quarter and another $202 billion next quarter. That is about $1 trillion of additional debt in the first half of 2024, added to the $34.2 trillion existing debt. Over the next twelve months, more than $6 trillion of existing debt is expected to mature, and the Fed will likely monetize it by printing more fiat money. The more money the Fed creates out of nothing, the more the money supply increases, and the more inflation will rise. It is simple math, and like gravity, it will eventually cause life-changing losses to investors who choose to ignore risk. We can look away and ignore the risk, but the facts will not change. Sooner or later, our ever-expanding debt will force us to face reality and deal with the elephant in the room. It took 200% inflation in Argentina to get rid of socialism, but now they are on the road to recovery. Always remember the market decides the return, and we choose how much risk/loss we will take. Sleep well.
Bottom line: Issachar is being rewarded for investing in growth stocks, and I expect the uptrends to continue! The market is discounting several rate reductions by the Fed. I expect the Fed to cut rates several times and serve as a backstop to a market correction. Gold and Bitcoin are flat, oil and the dollar are dropping, rates are declining, banks are struggling, and stocks that break out on strong volume are holding gains. I am bullish and expect to buy on dips. Thanks for your trust and business, and may God continue to Bless and Prosper You!
For I know the plans I have for you,” declares the LORD, “plans to prosper you and not to harm you, plans to give you hope and a future. Jeremiah 29:11
Investors should carefully consider the investment objectives, risks, charges, and expenses of the Issachar Fund. This and other important information about the Fund are contained in the Prospectus, obtained by calling 1-866-787-8355 or visiting IssacharFund.com. The Prospectus should be read carefully before investing. The Issachar Fund is distributed by Northern Lights Distributors, LLC., a member of FINRA/SIPC. Horizon Capital Management Inc. (HCM) is not affiliated with Northern Lights Distributors, LLC.
Important Risk Information: Mutual Funds involve risks, including the possible loss of principal. An investment in the Fund may not be appropriate for all investors. The Fund may hold cash positions when the Adviser feels that the market is not producing returns greater than the short-term cash investments in which the Fund may invest. There is a risk that the sections of the market in which the Fund invests will begin to rise or fall rapidly, and the Fund will not be able to sell stocks quickly enough to avoid losses or reinvest its cash positions into areas of the advancing market quickly enough to capture the initial returns of changing market conditions. The Adviser’s judgment about the attractiveness, value, and potential appreciation of particular asset classes and securities in which the Fund invests may prove incorrect and may not produce the desired results. Past performance is no guarantee of future results. Ratings are only one form of Fund performance and should not be used as the sole consideration in an investment decision. Opinions expressed are subject to change, not guaranteed, and should not be considered investment advice. There is no assurance these opinions or forecasts will come to pass, and past performance is no assurance of future results. For more information regarding the Fund, including current performance, please visit IssacharFund.com. 3135-NLD-02/05/2024
Dexter Lyons, Portfolio Manager
Issachar Fund (LIONX & LIOTX)
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Strategy, My Story, Biblically Responsible Investing (BRI)