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January 29, 2020

Another Way to Look at 2019…

  • 9% wage growth for people with a high school education – why?
  • A 3.6% unemployment (lowest since late 60’s) drives wages higher.
  • In the last 10 years, the price of an oil barrel has dropped $20 – the benefit?
  • More jobs, and a lower cost to heat/cool the homes of poor and lower income families. 

I recently was asked to comment on a note that asked me how to plan for a 2020 stock market retreat. My answer was – who told you that was happening? 

The amount of stimulus in this economy is noteworthy. Deregulation, low interest rates, high employment, consumer spending – all positive.  Also, a critical shift is taking place with international countries responding to the USA’s corporate tax decrease and business deregulation.  To compete the developed Euro countries are lowering taxes and regulations that stifle competition and market access.  The UK move on Brexit is a perfect example of such a performance recovery. The better the economies of other countries the more the opportunity for America.  US market diversification is also paying off. One of several interesting changes in 2019 has been the market shift lifting Value stocks.

There is a high chance that 2019 will have the Value sectors offering a higher return than growth stocks for the first time in 10 years.  

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