Jan 31, 2017
Learn if the economy can get to 5% GDP growth quickly or not.
Weakest GDP since 2011 - went from 3.5% to 1.9% in one quarter!
Lower earnings reported by Chevon, other energy companies, Google, Colgate-Palmolive and Starbucks.
Even with some disappointing corporate results, fourth-quarter earnings are expected to show growth of 6.8 percent, which would mark the biggest increase in two years and second straight quarter of growth, according to Thomson Reuters data.
Dow hit 20,000 for the first time. Took 18 years to double - that’s a 4% average annual return.
Is most of the good news already baked into 2017?
Consumer spending is up .5% in December, largest jump in 3 months, which is 2/3 of the economy. Good news there.
Pending home sales up 1.9%, 17 year shortage of housing.
Trump growth of 5% is going to take a while and won’t happen right away.
Cycles are showing massive swings up and down in the market this year.
FED may raise rates 3 times - inflation is flaring up.
IMO, we have the EU break up to look forward to, a European bank failure, and a lot of cash flowing into our markets as a safe haven from China and Europe.
Other countries have been moving their funds here from China, Russia and Europe and that will likely pick up.
Cycles are showing some extreme volatility and since this is the second longest bull market ever, I wouldn’t be surprised to see the economy weaken even to the point of recession and the stock market have a meaningful pullback.
Rather than try to short it, I suggest you get your shopping list ready to buy the dips, when there is real fear.
Look to corporate bonds for income and stay away from bond funds.
It will take time for President Trump to turn the economy into a faster growth GDP. In the meantime, there will be wild swings as the dollar and other currencies fluctuate.
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