by Louis Navellier

October 31, 2023

The Commerce Department reported last Thursday that the preliminary estimate for third-quarter GDP growth was an annual pace of 4.9%, due predominately to robust consumer spending. Personal spending last quarter rose at a 4% annual pace, the strongest rate since 2021. Rising energy exports helped, causing the trade deficit to decline, boosting GDP. Inventory growth accounted for 1.3% of the 4.9% growth. Excluding inventories and government spending, GDP growth rose at a 3.3% annual pace last quarter.

It is not unusual for inventories to build like this before the fourth quarter, in advance of holiday shopping build-up. However, if personal spending stalls in the fourth quarter, unsold inventory could cause an abrupt deceleration in GDP growth. If that happens, this could be the last of booming GDP quarters in a while, as high interest rates (for a long time, as the Fed implies) tend to cripple a number of key industries.

Last Friday, the Commerce Department announced that the Fed’s favorite inflation measure, the personal consumption expenditure (PCE) index rose 0.3% in September and 3.4% in the past 12 months. The core PCE, excluding food and energy, rose 0.4% in September and 3.7% in the past year. That means the Fed should not raise rates at its November or December Federal Open Market Committee (FOMC) meetings.

In addition, I should add that the European Central Bank (ECB) left its key interest rate unchanged at 4% in their central bank meeting last Thursday – after a historic run of 10 consecutive rate hikes.

In other economic news, the Commerce Department announced last Wednesday that new home sales rose 12.3% in September to an annual pace of 759,000. A decline in inventory of existing homes for sale continues to be one reason that new home sales are rising. The bad news is that average mortgage rates rose to 7.9%, according to the Mortgage Bankers Association, and mortgage activity has declined to the lowest level since 1995, which may curtail home sales in the upcoming months.

The Commerce Department announced last Thursday that September durable goods orders surged 4.7%, due largely to a rise in commercial aircraft orders. Excluding a 12.7% surge in transportation orders, durable goods rose 0.5%. This is an early indication that manufacturing activity may finally be improving.

There are also some “green shoots” in global trade. The first example is that South Korea’s early export data rose 8.6% in the first 20 days in October compared to a year ago. This is the first sign that global trade may have resumed rising after declining every month so far this year.

The Stock Market is Like “Mob Rule” – But We Engage in Independent Thinking

I like to say that, “The bigger the crowd, the lower the IQ,’ since the stock market is a manic crowd that is not always rational. Therefore, it was with some interest that I read that a Stanford University neurobiologist professor, Robert Sapolsky, recently concluded that after 40 years of studying humans and other primates, he determined that virtually all human behavior is beyond our conscious control and that we essentially react and do not think. Sapolsky created quite a controversy by saying that humans do not have “free will.” In his book, “Determined: A Science of Life with No Free Will” he said, “It’s impossible for any single neuron or any single brain to act without influence from factors beyond its control.”

I would respectively add that the stock market has no free will, either. It is just a manic crowd that likes to “react” first and “think” later, if at all. But this analysis goes beyond the stock market, to most global news events and trends. Situations like the wars in the Middle East and Ukraine may spin out of control without rational heads defusing the emotional situation. However, because every consequence has a reaction, we must choose as investors if we will just “react” or “think” when we see dramatic news cross the wires.

In other words, we have to decide whether or not we have “free will” in these situations, or do we just follow the mob and “react” to the news, since we allegedly have no impulse control or free will.

I realize that Professor Sapolsky knows more about the inner workings of neurons and brain activity than I do, so he may be right about how a crowd reacts, but eventually individual humans do start to “think” and many will then act rationally. Social media and politicians are masters at making crowds react, which is how the Middle East became so outraged so quickly. They know propaganda can spread like wildfire.

A case in point is the price of oil. Is it rising just because of war in the Middle East?  I don’t think so.

Crude oil prices remain high due, in part, to the renewed tension in the Middle East. However, I think the biggest development in oil prices coming this winter may be the fact that Western companies have abandoned Russia’s oil fields in the Arctic Circle, so if Arctic oil production is disrupted and/or the Arctic pipelines freeze, another 2-3 million barrels per day of Russian crude oil could go offline this winter.

Fortunately, the U.S. is still a major energy exporter of over four million barrels per day, so we can keep warm, while boosting our GDP and reducing our trade deficit by exporting some of our excess energy.

The Chevron acquisition of Hess Corporation for $53 billion is the second major acquisition in recent weeks. This gives Chevron a 30% interest in Guyana, which is throttling up from 400,000 barrels a day now to 1.2 million barrels per day by 2027, so Chevron will now have an interest in the fastest growing new oil field in the Americas. If Russia keeps going offline, it is imperative that the world develop more oil fields, so Guyana could boost oil production to meet global demand, with Chevron leading the way.

In EV news, the Volkswagen Group has passed Tesla to become the EV leader this year in Europe, thanks to its Audi, Bentley, Porsche, Seat, Skoda and VW brands that are selling EVs as well as plug-in hybrids. VW Group’s sales in Europe have risen 13.6% this year (through September), according to the European Automobile Manufacturers Association. Now that VW Group has almost 25 EV models, it is winning the EV war for market share, thanks to its great designs and many different models. The is expected to be VW’s biggest EV hit and a larger, long-range version of is heading to North America.

There remains a glut of EVs for sale, but VW Group has the financial strength to offer lower interest rates to stimulate sales. Ford announced on Thursday that it is postponing $12 billion in planned spending on EVs. One of the big reasons consumers are avoiding EVs, according to Executive Chair Bill Ford, is high prices. Stellanis is also pushing back on EVs. GM is now being criticized that it was never serious about making EVs, after it decided not to upgrade its Orion, Michigan plant to make EV pickup trucks. These EV moves by the Big 3 will likely appease the UAW, as EVs require fewer workers due to fewer parts.

Speaking of the strike, Ford and the UAW reached a tentative agreement last Wednesday. The UAW workers will get an immediate 11% raise and a 25% raise over the next four years. Better cost of living allowances and more generous pension contributions were also included in this tentative agreement.

We’ll see if this is the beginning of the end of the overall UAW strike. Somehow, I doubt it.

Navellier & Associates owns Volkswagen Ag. (VWAGY), some accounts own Ford Motor Co. (F), and one client holds Tesla (TSLA), per client request in managed accounts. We do not own Chevron (CHV) or General Motors (GM). Louis Navellier and his family own Volkswagen Ag. (VWAGY), via a Navellier managed account. He does not personally own Tesla (TSLA), General Motors (GM), Chevron (CHV), or Ford (F).

All content above represents the opinion of Louis Navellier of Navellier & Associates, Inc.

Please see important disclosures below.

About The Author

Louis Navellier

Louis Navellier is Founder, Chairman of the Board, Chief Investment Officer and Chief Compliance Officer of Navellier & Associates, Inc., located in Reno, Nevada. With decades of experience translating what had been purely academic techniques into real market applications, he believes that disciplined, quantitative analysis can select stocks that will significantly outperform the overall market. All content in this “A Look Ahead” section of Market Mail represents the opinion of Louis Navellier of Navellier & Associates, Inc.

Important Disclosures:

Although information in these reports has been obtained from and is based upon sources that Navellier believes to be reliable, Navellier does not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute Navellier’s judgment as of the date the report was created and are subject to change without notice. These reports are for informational purposes only and are not a solicitation for the purchase or sale of a security. Any decision to purchase securities mentioned in these reports must take into account existing public information on such securities or any registered prospectus.To the extent permitted by law, neither Navellier & Associates, Inc., nor any of its affiliates, agents, or service providers assumes any liability or responsibility nor owes any duty of care for any consequences of any person acting or refraining to act in reliance on the information contained in this communication or for any decision based on it.

Past performance is no indication of future results. Investment in securities involves significant risk and has the potential for partial or complete loss of funds invested. It should not be assumed that any securities recommendations made by Navellier. in the future will be profitable or equal the performance of securities made in this report. Dividend payments are not guaranteed. The amount of a dividend payment, if any, can vary over time and issuers may reduce dividends paid on securities in the event of a recession or adverse event affecting a specific industry or issuer.

None of the stock information, data, and company information presented herein constitutes a recommendation by Navellier or a solicitation to buy or sell any securities. Any specific securities identified and described do not represent all of the securities purchased, sold, or recommended for advisory clients. The holdings identified do not represent all of the securities purchased, sold, or recommended for advisory clients and the reader should not assume that investments in the securities identified and discussed were or will be profitable.

Information presented is general information that does not take into account your individual circumstances, financial situation, or needs, nor does it present a personalized recommendation to you. Individual stocks presented may not be suitable for every investor. Investment in securities involves significant risk and has the potential for partial or complete loss of funds invested. Investment in fixed income securities has the potential for the investment return and principal value of an investment to fluctuate so that an investor’s holdings, when redeemed, may be worth less than their original cost.

One cannot invest directly in an index. Index is unmanaged and index performance does not reflect deduction of fees, expenses, or taxes. Presentation of Index data does not reflect a belief by Navellier that any stock index constitutes an investment alternative to any Navellier equity strategy or is necessarily comparable to such strategies. Among the most important differences between the Indices and Navellier strategies are that the Navellier equity strategies may (1) incur material management fees, (2) concentrate its investments in relatively few stocks, industries, or sectors, (3) have significantly greater trading activity and related costs, and (4) be significantly more or less volatile than the Indices.

ETF Risk: We may invest in exchange traded funds (“ETFs”) and some of our investment strategies are generally fully invested in ETFs. Like traditional mutual funds, ETFs charge asset-based fees, but they generally do not charge initial sales charges or redemption fees and investors typically pay only customary brokerage fees to buy and sell ETF shares. The fees and costs charged by ETFs held in client accounts will not be deducted from the compensation the client pays Navellier. ETF prices can fluctuate up or down, and a client account could lose money investing in an ETF if the prices of the securities owned by the ETF go down. ETFs are subject to additional risks:

  • ETF shares may trade above or below their net asset value;
  • An active trading market for an ETF’s shares may not develop or be maintained;
  • The value of an ETF may be more volatile than the underlying portfolio of securities the ETF is designed to track;
  • The cost of owning shares of the ETF may exceed those a client would incur by directly investing in the underlying securities; and
  • Trading of an ETF’s shares may be halted if the listing exchange’s officials deem it appropriate, the shares are delisted from the exchange, or the activation of market-wide “circuit breakers” (which are tied to large decreases in stock prices) halts stock trading generally.

Grader Disclosures: Investment in equity strategies involves substantial risk and has the potential for partial or complete loss of funds invested. The sample portfolio and any accompanying charts are for informational purposes only and are not to be construed as a solicitation to buy or sell any financial instrument and should not be relied upon as the sole factor in an investment making decision. As a matter of normal and important disclosures to you, as a potential investor, please consider the following: The performance presented is not based on any actual securities trading, portfolio, or accounts, and the reported performance of the A, B, C, D, and F portfolios (collectively the “model portfolios”) should be considered mere “paper” or pro forma performance results based on Navellier’s research.

Investors evaluating any of Navellier & Associates, Inc.’s, (or its affiliates’) Investment Products must not use any information presented here, including the performance figures of the model portfolios, in their evaluation of any Navellier Investment Products. Navellier Investment Products include the firm’s mutual funds and managed accounts. The model portfolios, charts, and other information presented do not represent actual funded trades and are not actual funded portfolios. There are material differences between Navellier Investment Products’ portfolios and the model portfolios, research, and performance figures presented here. The model portfolios and the research results (1) may contain stocks or ETFs that are illiquid and difficult to trade; (2) may contain stock or ETF holdings materially different from actual funded Navellier Investment Product portfolios; (3) include the reinvestment of all dividends and other earnings, estimated trading costs, commissions, or management fees; and, (4) may not reflect prices obtained in an actual funded Navellier Investment Product portfolio. For these and other reasons, the reported performances of model portfolios do not reflect the performance results of Navellier’s actually funded and traded Investment Products. In most cases, Navellier’s Investment Products have materially lower performance results than the performances of the model portfolios presented.

This report contains statements that are, or may be considered to be, forward-looking statements. All statements that are not historical facts, including statements about our beliefs or expectations, are “forward-looking statements” within the meaning of The U.S. Private Securities Litigation Reform Act of 1995. These statements may be identified by such forward-looking terminology as “expect,” “estimate,” “plan,” “intend,” “believe,” “anticipate,” “may,” “will,” “should,” “could,” “continue,” “project,” or similar statements or variations of such terms. Our forward-looking statements are based on a series of expectations, assumptions, and projections, are not guarantees of future results or performance, and involve substantial risks and uncertainty as described in Form ADV Part 2A of our filing with the Securities and Exchange Commission (SEC), which is available at or by requesting a copy by emailing All of our forward-looking statements are as of the date of this report only. We can give no assurance that such expectations or forward-looking statements will prove to be correct. Actual results may differ materially. You are urged to carefully consider all such factors.

FEDERAL TAX ADVICE DISCLAIMER: As required by U.S. Treasury Regulations, you are informed that, to the extent this presentation includes any federal tax advice, the presentation is not written by Navellier to be used, and cannot be used, for the purpose of avoiding federal tax penalties. Navellier does not advise on any income tax requirements or issues. Use of any information presented by Navellier is for general information only and does not represent tax advice either express or implied. You are encouraged to seek professional tax advice for income tax questions and assistance.

IMPORTANT NEWSLETTER DISCLOSURE:The hypothetical performance results for investment newsletters that are authored or edited by Louis Navellier, including Louis Navellier’s Growth Investor, Louis Navellier’s Breakthrough Stocks, Louis Navellier’s Accelerated Profits, and Louis Navellier’s Platinum Club, are not based on any actual securities trading, portfolio, or accounts, and the newsletters’ reported hypothetical performances should be considered mere “paper” or proforma hypothetical performance results and are not actual performance of real world trades.  Navellier & Associates, Inc. does not have any relation to or affiliation with the owner of these newsletters. There are material differences between Navellier Investment Products’ portfolios and the InvestorPlace Media, LLC newsletter portfolios authored by Louis Navellier. The InvestorPlace Media, LLC newsletters contain hypothetical performance that do not include transaction costs, advisory fees, or other fees a client might incur if actual investments and trades were being made by an investor. As a result, newsletter performance should not be used to evaluate Navellier Investment services which are separate and different from the newsletters. The owner of the newsletters is InvestorPlace Media, LLC and any questions concerning the newsletters, including any newsletter advertising or hypothetical Newsletter performance claims, (which are calculated solely by Investor Place Media and not Navellier) should be referred to InvestorPlace Media, LLC at (800) 718-8289.

Please note that Navellier & Associates and the Navellier Private Client Group are managed completely independent of the newsletters owned and published by InvestorPlace Media, LLC and written and edited by Louis Navellier, and investment performance of the newsletters should in no way be considered indicative of potential future investment performance for any Navellier & Associates separately managed account portfolio. Potential investors should consult with their financial advisor before investing in any Navellier Investment Product.

Navellier claims compliance with Global Investment Performance Standards (GIPS). To receive a complete list and descriptions of Navellier’s composites and/or a presentation that adheres to the GIPS standards, please contact Navellier or click here. It should not be assumed that any securities recommendations made by Navellier & Associates, Inc. in the future will be profitable or equal the performance of securities made in this report.

FactSet Disclosure: Navellier does not independently calculate the statistical information included in the attached report. The calculation and the information are provided by FactSet, a company not related to Navellier. Although information contained in the report has been obtained from FactSet and is based on sources Navellier believes to be reliable, Navellier does not guarantee its accuracy, and it may be incomplete or condensed. The report and the related FactSet sourced information are provided on an “as is” basis. The user assumes the entire risk of any use made of this information. Investors should consider the report as only a single factor in making their investment decision. The report is for informational purposes only and is not intended as an offer or solicitation for the purchase or sale of a security. FactSet sourced information is the exclusive property of FactSet. Without prior written permission of FactSet, this information may not be reproduced, disseminated or used to create any financial products. All indices are unmanaged and performance of the indices include reinvestment of dividends and interest income, unless otherwise noted, are not illustrative of any particular investment and an investment cannot be made in any index. Past performance is no guarantee of future results.