by Louis Navellier
September 1, 2026
Labor Day traditionally marks the start of the campaign season before the November elections. I expect the news media to become progressively more negative as these elections approach. Unfortunately, the financial media will likely follow the same script, exemplified by the critical coverage of Nvidia. It is truly sad the media promotes fear more than prosperity. Andrew Ross Sorkin has been quite negative lately, as he ignores positive economic news – like record earnings growth and the AI productivity boom.
As investors and voters, we must decide if we want to be manipulated by the news media and miss some great investing opportunities, or if we want to share in the success of many billionaires, like Jensen Huang (of Nvidia), Sundar Pichai (Google) and Alex Karp (of Palantir Technology). Many of our top technology CEOs are foreign-born, including trillionaire Elon Musk. Even though I don’t recommend his companies, I am not anti-Musk, as I hope to invest in one of his companies when they pass my strict fundamental criteria.
The order backlogs for our AI-related stocks continue to rise, since AI developers are like Captain Kirk on the Star Trek series demanding more power from his engineer, Scotty. Right now, the data-centers are sounding like Scotty screaming back, “That is all the power we’ve got!” We cannot stop the AI boom, since ChatGPT, Claude (Anthropic) and Grok (SpaceX) are all demanding more computing power. As a result, GE Vernona has a massive $176 billion dollar order backlog that is expected to continue to rise.
In case you wonder why I am so careful before I sell any stocks, our Nevada-based accounts would incur 23.8% in long-term capital gain taxes on our estimated billion dollars of assets (including the 3.8% Obamacare tax above $250,000) like in other federal tax-free states such as Alaska, Florida, New Hampshire, South Dakota, Tennessee, Texas and Wyoming. Even worse, clients in California could incur 37.1% in long-term capital gain taxes (including the 3.8% surcharge) if I decided to go to cash. Under no circumstances do I want to trigger $238 million to $371 million in capital gains taxes for my clients by overreacting to fear mongers.
I believe the key to success in America is to identify great companies and then ride them as long as they score highly in my 8-factor Fundamental model. That is why I never sold Super Micro Computer, despite relentless short seller attacks – from the likes of Citron founder, Andrew Left, who was recently sentenced to 20-years in jail for market manipulation. Michael Burry is another notable short seller, with the news media amplifying his influence. Negative news sells, which is why Andrew Ross Sorkin recently invited Jeffery Gundlach on CNBC to trash the stock market, but fortunately CNBC co-host Joe Kernan pointed out Gundlach has not been correct with his market forecasts since 2010.
Turning to the election outlook, on a recent appearance on Fox Business, I mentioned the Trump agenda will not likely be derailed by any leadership change in the House of Representatives, since the vast majority of federal spending for the next two years has already been front-loaded. As a result, I do not want you to worry about upcoming consequences of the mid-term elections. The good news is the market tends to soar after the mid-term election season ends, and even the news media should cheer up then, since Thanksgiving and the holidays are a happy time of year, so we may finally see some positive news.
Good stocks generally bounce back, as their fundamentals cannot be ignored for very long. For instance, I have had some clients question my massive holding in Nvidia, and I politely told them that I believe there are no better stocks to own, especially considering the tax consequences of selling a stock with a massive capital gain. I want you to ride with good stocks and feel good about America. Let’s grow and prosper by investing with successful billionaires, enjoying an incredible earnings environment as well as explosive growth!
A Canada vs. U.S. Trade War Could Hurt Both Nations
Canada’s Prime Minister Mark Carney and President Donald Trump clearly do not get along well, but the tit-for-tat tariff battle between the U.S. and Canada strikes me as stupid. Apparently, negotiations broke down over the details, but since trade between Canada and the U.S. is massive, cooler heads will prevail. Specifically, I suspect the auto industry will intervene, and the trade spat will end. In the meantime, President Trump on Thursday ordered the Interior Department to rename Lake Ontario to Lake America.
There are also rumblings about Prime Minister Carney, who is very close to European Union leaders and has been striving to do more business with China. He also may be purposely trying to influence mid-term elections, especially since Michigan is a swing state. Ontario Premier Doug Ford has threatened to cut off electricity sales to the U.S., which is truly stupid, but it illustrates how poor Canadian and U.S. relations have become. Ontario has a massive auto industry supplying the U.S. and it literally makes no sense to irritate the Trump administration, who are trying to onshore more auto parts in America. Longer-term, this trade spat will hurt Canada, especially Ontario, so hopefully the auto industry will force a resolution.
Turning to the question of what to do with Venezuela’s oil, President Trump announced the “biggest oil deal in world history,” as the U.S. has secured majority control of more than 65 billion barrels of Venezuela’s proven oil reserves. Trump said the agreement was reached through Secretary of State Marco Rubio, Secretary of War Pete Hegseth, Venezuela’s interim president Delcy Rodriguez, and private business “at no cost to the American Taxpayer.” Marco Rubio said, “This deal is a huge win for both the American and Venezuelan people. It demonstrates how President Trump’s bold foreign policy is driving America First wins: securing stable reserves and low-cost oil in our hemisphere and lowering gas prices here at home. For the Venezuelan people, this deal will bring nearly $100 billion in private investment, support thousands of high-paying jobs, and drive the reconstruction of Venezuela’s economy.”
The Latest Economic Indicators Are Mostly Positive
Last Tuesday, the Conference Board said its consumer confidence index slipped to 89.4 in August, down from 90.2 in July, but there is a great division between the positive “now” view vs. a negative future! Specifically, the “present situation” component surged to 121.2 in August from 114.4 in July, while the “future expectations” component plunged to 68.2 from 74 in July. How do you explain a current situation (at 121.4) nearly twice as good as the future (at 68.2)? This is a confusing consumer confidence report.
On Wednesday, the Commerce Department announced durable goods orders rising 1.1% in July, which was substantially better than the economists’ consensus estimate of a 0.4% increase. Excluding transportation, durable goods rose 0.4%. Core capital goods rose 0.3% in July. The bottom line is a 2.3% increase in transportation orders boosted July’s durable goods report. One bright spot was that, excluding defense orders, new durable goods orders increased 1.3%, which is positive for GDP growth. Another piece of good news came when the Commerce Department reported personal income rose 0.4% in July.
The Personal Consumption Expenditure (PCE) index (the Fed’s favorite inflation indicator) rose 0.2% in July, a bit higher than the economists’ consensus expectation of a 0.1% increase. The core PCE, excluding food and energy, also rose 0.2%, which was in-line with economists’ consensus expectation.
The inflation relief that showed up in the July CPI and PPI reports was absent in the PCE report. This was expected by most economists, since the PCE components were also part of the CPI and PPI report details, but the debate on whether or not the Fed should hike key interest rates has re-emerged. As a result, the importance of Fed Chairman Kevin Warsh’s speech in Jackson Hole on Friday was closely scrutinized.
I thought Warsh gave an excellent speech at Jackson Hole. He said inflation isn’t meaningfully slowing and vowed to bring it back “at sufficient speed” to the Fed’s 2% goal, which he described as a “firm and fixed” target. Furthermore, Warsh said, “The wiser course was to await new information,” particularly given “possible developments in supply chains, investment flows, and geopolitics.”
I was also pleased Warsh talked about the AI boom and the incredible productivity gains it is unleashing. He said his new task forces at the Fed are studying the impact of AI and productivity gains on the U.S. economy and implied there appears to no negative inflationary impact. Overall, Treasury yields were not significantly impacted by Jackson Hole, as the U.S. dollar strengthened sharply during Warsh’s speech.
And finally, the Labor Department on Friday revised down its calculation of payroll jobs by 79,000 in the past year through March. These payroll revisions have become common in recent years, due to the fact that some people have two jobs and get counted twice. However, due to the downgrade in the number of payroll jobs, the Fed should be cautious with its monetary policy due to its unemployment mandate.
Navellier & Associates; own Nvidia (NVDA), Super Micro Computer, Inc. (SMCI), Alphabet Inc. Class A (GOOGL), Palantir Technologies Inc. Class A (PLTR) and Micron Technology, Inc. (MU) in managed accounts. We do not own Space Exploration Technology Corp (SPCX) in managed accounts. Louis Navellier and his family own Nvidia (NVDA), Super Micro Computer, Inc. (SMCI), Alphabet Inc. Class A (GOOGL), Palantir Technologies Inc. Class A (PLTR) and Micron Technology, Inc. (MU) via a Navellier managed account and Nvidia (NVDA) in a personal account. They do not own Space Exploration Technology Corp (SPCX) personally.
All content above represents the opinion of Louis Navellier of Navellier & Associates, Inc.
Also In This Issue
A Look Ahead by Louis Navellier
What to Expect from Mid-Term Elections (and Trump’s Trade Wars)
Income Mail by Bryan Perry
The Amazing Stock Buyback Phenomenon Continues
Growth Mail by Gary Alexander
The Perils of Market Seasonality (or “Selling All Stocks”)
Global Mail by Ivan Martchev
Why U.S. Investors Should Care About EU Natural Gas Prices
Sector Spotlight by Jason Bodner
AI (Like the Transistor, PCs and Internet) Will Change Everything
View Full Archive
Read Past Issues Here
Louis Navellier
CHIEF INVESTMENT OFFICER
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.
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