As the U.S. evolved from a goods economy to a services economy, expansionary cycles more than doubled in length. But a recent resurgence in manufacturing may be taking us back to the future.

As the second quarter came to a close, the Fed’s elusive soft landing appeared to be within reach. However, inflation resurfaced during the third quarter, substantially complicating the near-term economic outlook.

The S&P 500 has generated double digit returns so far in 2023, but the gains have been narrowly focused. Heading into the second half, we will be watching to see whether the rally broadens or the market capitulates.

Investors today probably feel a bit like the joker and the thief from Dylan’s classic, “All Along the Watchtower” – there’s too much confusion, they can’t get no relief. But our Core Equity team believes there is a way outta here – investing in dominant companies that pay growing dividends.

Generating investment income is challenging, especially in the low-yield environment we have been living with for the past decade.

Equity markets have struggled so far in 2022, but in our view the declines are largely due to “The Great Normalization” – the unwinding of the Covid economy that was defined by excess liquidity, unusually high demand, and extremely low interest rates.

In our latest outlook we examine the long-term implications of the pandemic, particularly changes to the labor market and the supply chain, and we discuss why we will be focusing on companies with pricing power in 2022.

Concerns about inflation and a looming Fed taper weighed on markets during the third quarter, but in our view the post-pandemic economy is well-positioned for extended cycle of capital investment, providing the impetus for broadening economic growth and job creation.

Equities continued to rally in the second quarter, but the market remains undecided about whether the recent uptick in inflation is more likely to be transitory or persistent.

Despite a volatile first quarter, economic fundamentals appear to be improving. We are constructive on the equity market in the near-to-medium term, but we are closely monitoring inflation and interest rates.

Several pundits have raised the possibility that the current Covid-recession will be followed by a boom reminiscent of the Roaring '20s. Although we think that may be a tad too optimistic, we think the recovery will continue and feel “real economy” stocks could fare particularly well.

Despite ongoing weakness in the economy, stocks continued to rally in the third quarter. At first glance it seems perplexing, but a deeper analysis reveals that the market drivers are both rational and sustainable. In our view, the pandemic has created profound shifts in demand that have generated strong tailwinds for a wide range of firms.

Thus far the market has shrugged off the recent rise in Covid cases, but the situation remains fluid. In our view, the best strategy is to invest in companies that are able to grow during this time of stress, either organically or by increasing market share as weaker competitors fall by the wayside.

Rarely has market performance and sentiment changed so quickly than what has been observed in the first quarter of 2020. The start of the year was promising, with the S&P 500 climbing above 5% through the middle of February...

As we have written several times over the last 10 years, inflation has been kept down by the twin forces of globalization and technology (particularly digital technology). These forces are not going away, and in fact, digital technology is becoming increasingly pervasive throughout the economy, dramatically increasing efficiency and lowering costs in industry after industry. We do not see this trend abating.

During the third quarter, the stock market, as measured by the S&P 500 Index (S&P 500), posted a modest 1.70% gain, while the U.S. economy enjoyed a continuation of the recovery begun in 2009. Both achievements were remarkable...

During the second quarter, the stock market continued to rebound from last year’s fourth quarter swoon. This reflected the recognition that neither the trade war nor Federal Reserve (Fed) monetary policy was about to torpedo the long, slow recovery from the 2008 housing debacle.

After suffering a tumultuous fourth quarter last year, the stock market rebounded nicely in the first quarter of 2019. Fears of an economic slowdown, escalating trade wars and monetary tightening gave way to optimism over continued economic expansion, low unemployment, a trade deal with China...

The fourth quarter of 2018 saw U.S. equities decline materially, with especially steep falls in December. During the fourth quarter the equity market as measured by the S&P 500 generated a total return of -13.5%, bringing full year S&P returns to -4.4%. While disappointing, these results need to be seen in the context of a broader and much more severe downturn in global equity markets.

During the second quarter the equity market as measured by the S&P 500 Index had a total return of 3.4%, bringing the year-to-date total return to 2.6%. Second quarter performance reflects the continued low-inflationary expansion of the U.S. economy and the attendant growth in corporate profits. All else being equal, we would expect these trends to persist. The question, of course, is whether “all else is equal.”

During the first quarter of 2018, the stock market, as measured by the S&P 500 Index, had a total return of minus 0.8%. Despite the roughly flat performance for the quarter, volatility spiked to levels not seen in several years.

During the fourth quarter, the stock market, as measured by the S&P 500 Index (the S&P 500), rose another 6.64%, propelling its full year 2017 total return to 21.83%. This reflects the continued low inflationary economic expansion, rising corporate profits and a very clear pro-business agenda in Washington.

During the third quarter, the economy continued its slow, low inflationary expansion and the equity market continued to gain ground. Real Gross Domestic Product (GDP) expanded by an estimated 2.5%, and inflation hovered around 2.0%.

During the first quarter of 2017, the stock market (as measured by the S&P 500 Index) enjoyed a 6.07% total return. The gains reflect (1) the steady, persistent, non-inflationary economic recovery that has characterized the post-2008 period and (2) investor enthusiasm for President Trump’s pro-business, pro-growth policies.

Since the election of Donald Trump as our next President and the Republicans’ win of both the House and Senate, much has changed in regards to our economic and investment outlooks.