Market Commentary Q4: Dancing Days
SEI has issued its Fourth Quarter Economic Outlook for 2017. The outlook contains information about:
- Classic rock fans will know what I mean when I say that global economies and financial markets “got the Led out” in 2017. For those of you less familiar with the music of Led Zeppelin, we can sum up the year gone by with the exclamation that, at long last, the global financial crisis finally appears to be in the rear-view mirror.
- Stock prices are rising because earnings are advancing smartly AND the earnings multiple is expanding.
- It’s possible that the U.S. will see inflationary pressures finally begin to build in the New Year. Most labor-related statistics strongly suggest that the U.S. economy is approaching full employment.
- Timing the market in anticipation of a short-term correction should be discouraged. Until we see a more significant deterioration in the economic and financial fundamentals that have underpinned the global bull market in risk assets over the past two years, we think it is best just to keep calm and ramble on.