Equity markets staged a remarkable recovery this week. After falling ~2% over 3 days, breaching some key technicals, a strong November jobs report helped the equity market is on track to finish positive for the week. This “hard bounce” is supported by more than a “performance YE chase” since one could have argued stocks had already seen their high for the year.
POINT 1: LARGE SIZE OF MILLENNIALS CAUSING ACCELERATION OF US GDP MULTIPLIER/GROWTHMore importantly, we believe investor framework about the US economy is changing. The US seems to be largely avoiding the sluggishness seen in Asia and Europe, stupefying many economists who expected the US to sink with the rest of the World.
We have asserted the US is increasingly ‘de-coupling’ from the rest of the World because of building demographic tailwinds. In short, we can thank Millennials, who are now entering their prime income years. (Or we can thank their parents for having lots of kids).
Please go to Youtube and see some of the brilliant market calls by Tom Lee.