We continue to have a bullish view of the U.S. economy. More positive economic data surface each week. U.S. small business optimism is at the highest level that it has ever reached in its 45-year history, says Monty Guild. Join Guild's Quarterly Forecast Sept. 26.
1) Stocks follow corporate profits. Today corporate profits are growing at almost 24% due to lower taxes, rapid growth in capital investment, and the hiring of new personnel.
(2) Corporate profits follow economic activity; currently, economic activity is at a multi-year high.
3) Economic activity is a function of availability of capital and incentives to grow. Incentives to growth are the best they have been in the U.S. for many years. Capital is available and plentiful.
(4) Capital availability drives business growth, and low inflation allows business to borrow at low rates to expand. Inflation is still low and signs on the horizon are for slightly higher but not extreme inflation.
We remain bullish on U.S. stocks, and believe that disruptive technology, cloud services, cybersecurity, specialty retailing, biotechnology, financial technology, travel, and entertainment are attractive sectors for investment.
Join the whole Guild team on Wednesday, September 26 at 10 am PDT for Guild’s Quarterly Forecast, our regular conference call and webinar on the most important trends affecting your portfolio, how we view the world, and where you can find the best investment opportunities.
In our presentation, we’ll cover:
• Economic and financial fundamentals that will keep driving outperformance for U.S. stocks;
• Why you should remain cautious on emerging markets, and where to look for bargains and trading opportunities;
• Why you should steer clear of Europe;
• What U.S. sectors and industries will enjoy the best prospects in the coming months;
• How you can detect the early warning signs of an oncoming recession and bear market. You can just listen in, or you can send in your questions for a personal response by Monty, Tony, Tim, and Rudi.
