While many investors ascribe recent market performance solely to a post-election surprise, we argue that there’s a simpler explanation. Remember, it’s checkers not chess.
2017 is all about inflation. As many investors hold onto the notion of “lower for longer”, we recognize that re-inflation will likely take hold in the New Year and those positioned for an improving global economy will benefit.
Fears of a repeat 2008 bear market are causing many investors to remain wallflowers during the second longest bull market of the post-war period. We argue, this fear is unfounded and the opportunity cost of avoiding equities keeps growing and growing.
Bears might blame the bull market on the Fed, but it’s improving fundamentals that keep it on course. It ain’t just the Fed.