A “spending boom” will happen in Y 2021 as pent-up demand from consumers and increased liquidity shoveled into the economy as a successful vaccine and and C-19 coronavirus treatment is developed.
And the stock market has much more room to run even from these record all-time highs.
The increased liquidity from the Fed and other world central bank policies in response to the C-19 coronavirus chaos will flow into stocks driving them due North.
All of this money will flow directly into the economy and into the stock market.
With bond yields near record lows, there is no alternative to stocks, and gold will become the hedge of choice.
The spending boom is going to be the start of a new expansion, but the new economy is going to look different than it did in Y 2019.
The world’s outlook has shifted, even after this virus disappears. As the economy opens up, as therapeutics and/or vaccines get developed that reduce that fear, we will see the cyclical economy sensitive stocks doing better.
Economist Bruce WD Barren, Chairman of The EMCO/ Hanover Group notes: “As the Dow Jones Industrial Average goes up, the distance between milestones goes down and right now it sits at less than 4% thus making it easier for further growth and in the US’ case, its ability to reach the 30,000 market. Consumer confidence remains optimistic, a Key driver. Further, most of the recent growth in consumer debt has been caused by the current positive activity in the real estate market which effects other consumer related industries, such as home furnishings and other related consumer products. Add the fact that consumer credit card debt still has the ability for growth furthers economic expansion outlook.“
Have a healthy day, Keep the Faith!