Naysayers and doubters will eat crow pudding.

Naysayers and doubters will have their day, but not until they’ve eaten their crow pudding for the holidays. 

In large doses no doubt.  Market averages continue to reach record highs and look poised to go even higher.  All the discussion surrounding valuations, earnings, world politics, and trade have not deterred US equity markets.  They are on course to report out sized gains for the year.  And for all those with vertigo there are places in the market for you to invest. 

Markets are being driven by two reasons.

• The Fed has been easing and the US consumer continues to consume.  The Fed changed its course early this year after last December’s debacle.  A Fed on autopilot is not the kind and gentler central banker world markets took kindly to.  Stopping the balance sheet run-off and rate increases made for more liquidity.  With bond yields at anemic levels, capital soon found better places to put money to work.
• And let’s not forget the consumer.  As two-thirds of our nation’s output, this segment remains healthy and looks poised to continue doing those things it does well, borrow and spend.  Consumer debt continues to rise but in line with GDP. Delinquencies on consumer loans remain low and average credit scores on mortgages and autos remain elevated and stable.  Mortgage rates are low and with employment at all-time highs and wages increasing, (at a pace which keeps the Fed from becoming nervous) the consumer should continue to be the prime factor pushing our economy toward sustained growth.  Manufacturing will get the press, but the consumer is the sector in the room where it happens.

An accommodative Fed, along with good employment across most sectors, bodes well for continued expansion of our economy.  So, I’ll pass on the avian offering for now.   Make mine figgy pudding and Happy Thanksgiving to all.

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