It’s hard to have a recession with this rising nationally
“Davidson” submits:
The economic data continues to march higher with today’s Real Personal Income release. When matched against Real Retail Sales the correlation between these measures of consumer financial health and recessions should be obvious. There are no signs of recessionary threats in the current data. This has been so since Apr 2020 despite periods in which many feared we would tip into a dire economic collapse at any time. Some even claimed we were in recession even though none of the key hard data supported this thinking. I emphasize hard data to separate it from the myriad of indicators based on market psychology, soft data, which are utterly useless except for making decisions when the hard data and soft data are on the opposite poles of their respective signals. Somewhat like today, when investors are pessimistic as economic activity is clearly positive and has been so nearly 4yrs with few in agreement.
The SP500 printed a new high this week once again among a mass of confused investor commentary. This will continue till every investor is bullish, perhaps another 2yrs-3yrs into the future. At that point it will be time to exit equities but for now 100% equities is the suggestion as interest rates are also likely to damage fixed income positions.