“Davidson” submits:
Since 2009, much of this economic cycle has been met with skepticism. Every new high in employment and employment received surprised but grudging acceptance. As this cycle extended into the longest uptrend in history the disbelief built sharply with accompanying high volatility in 2018-2019. Multiple well-known and respected money managers at the Davos conference this week agreed it was time for economic recession. Despite continued pessimism, economic activity and equity markets continue their push higher. Economic indicators measuring goods produced and transported and the demand for employees continue to reveal the presence of a strong economic climate.
The Chemical Activity Barometer(CAB) posted a record high this week breaking higher after being flat the past 12mos+. CAB flattening can be seen to have been relative to an earlier period of strength. It remains on trend since 2009. Job Openings & Trucking Tonnage Index also remain on trend after similar small corrections from earlier surges. These surges can be attributed to the US 2017 initiatives in tax and regulation reduction.
There continues to be no signs of recession. Corporate management teams appear to have worked through the recent period of US$ strength just as they did 2014-2016. The economic signs point to higher GDP, higher employment, higher retail sales and higher personal income in the months ahead.
Equity prices should follow.
