1. The ability for continued monetary stimulus and a hopeful trade resolution points to a global economic recovery, not recession, in 2020.
2. Aggressive global central bank rate cuts will likely continue to keep bond yields lower.
3. Fed’s dovish monetary policy should be short lived with one more rate cut expected this year followed by a justified firmer stance moving forward.
1. Global equities posted positive performance for the quarter despite a difficult May with the S&P 500 recording best June since 1955.
2. Collapse of 10 year treasuries contributed to a strong quarter for bonds.
3. Though expansion is long in the tooth, current economic indicators support continued growth.
1. Domestic equities’ performance in Q1 was the best in nearly 10 years.
2. Favorable interest rates plus a potential China trade resolution have driven much of this year’s equity rally.
3. The Fed’s pivot to a more dovish monetary policy drove U.S. bonds higher.
1. We find little evidence of excess in the economy that usually results in a recession, and this gives us reason to think the next recession is still some time away.
2. The investment markets are re-pricing for a slowdown in economic growth, but absent a recession, the bull market is likely to resume.