Investor CAFÉ

From Business Slump to Business Boom: What It Means to Investors

Where is the stock market heading? My new gross output (GO) and Skousen B2B Index may have the answer.

Last Friday, the federal government released the full year of 2016 GO, the top line of national income accounting. Nominal GO grew at an astonishing 6.2% annualized rate for fourth-quarter 2016. In real terms, it was 3.6% — which was much higher than gross domestic product (GDP) growth. To read my full press release click here: http://mskousen.com/2017/04/gross-output-and-b2b-index-advance-sharply-after-election/.

The fourth-quarter Skousen B2B index grew even faster at an 8.4% annualized rate for nominal B2B spending, with a 5.8% real rate.

My view: A year ago, GO and B2B spending was in a recession. But the fourth-quarter GO suggests that the Fed’s easy-money policies and Trump’s election have had a positive impact on business spending and outlook, and justifies the stock market rally into 2017. I’m still 100% invested but future rallies will depend on positive news in Washington and around the world. (We just confirmed Senator Mike Lee and Congressman Thomas Massie to speak at FreedomFest and tell us the latest happening on Capitol Hill.)

Click here to read the full article: “From Business Slump to Business Boom: What It Means to Investors.


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