Key Points

  • Much of the pick-up in economic growth, as well as the earnings turn, pre-dated the election and shouldn’t be fully credited to President Trump.
  • Growth has accelerated globally; while nominal growth in the United States is under-appreciated.
  • Recent consolidation in stocks likely about sentiment having gotten a tad too frothy.

Trumponomics, the Trump Trade, the Trump Rally—and more recently Trumpocalypse—you've heard them all. Now you'll read a story (and perhaps hum a tune) about economic inflection points and a stronger stock market which may have had little to do with the results of the election. I'm not dismissing the impact on confidence readings of the hope for pro-growth Trump administration policies, but as we've been pointing out for several months, many of the fundamentals supporting stocks had their inflection points pre-election.

One of these things...

This week I broke from my long tradition of using rock song titles for my reports. But recently I recalled fondly a Sesame Street song from my childhood, with these catchy lyrics:

One of these things is not like the others

One of these things just doesn't belong

Can you tell which thing is not like the others

By the time I finish my song?

It popped back into my head the other day when I looked at this chain of charts:

Source: FactSet, The Conference Board, as of March 31, 2017.