- Investors are very optimistic in bull markets and allocate much of their portfolio to stocks, increasing their risk.
- Analysts and economists expect more spending which will consequently push GDP and inflation up, but low rates push people to save more for their retirement.
- If the GDP and earnings don’t grow as expected, we could see a bear market in 2017.
Stock markets keep going up while fundamentals keep going down and the economic situation isn’t that great either. The S&P 500 is dancing around new highs despite corporate earnings for Q2 falling by 3.6%, and the economy only growing by 1.2% on an annualized basis. Economic growth for the whole of 2016 is only at 1%. More →