Liz Ann Sonders, Charles Schwab & Co’s Senior Vice President and Chief Investment Strategist (meaning: she is the “big cheese” for giving investment and economic analyis) recently wrote an enlightening article which contradicts the doom and gloom, follow the herd mentality we hear from the new media. Her important points are, in summary:
- Recent U.S. employment data has renewed the possibility of further Federal Reserve short-term interest rate increases (not decreases as the media would have you believe).
- The stock market appears reasonably valued, and higher valuations are unlikely without a return to positive earnings growth.
- Some market participants have said low oil prices are sending a recessionary signal, but recessions historically have been preceded by oil price spikes, not crashes(as the media would have you believe).