CFA Society Baltimore

Upcoming CFASB Event:

View from the top: Major macro factors affecting investors the next 25 years​

As major stock indices have trundled higher in 2017 we have monitored macro-drivers that surround what we call the "reflation vs. deflation" case. We are bullish "reflation trades" through spring 2018 (Financials, Energy, Materials, and Industrials) as part of an economic optimism topping out process for the post-2009  bull market. Those are short-term issues the next 2 years about which we have written. For this talk we will examine more closely our long-term work which concludes the following:

1. ​The S&P 500 the next decade should remain 2,300 +/- 15% from 2016 to 2025 (much to the dismay of indexers),
2. Commodities have reached a reflation vs. deflation "fork in the road" with implications for equity and fixed income,
3. The fiscal situation may prompt the Fed to peg/cap the U.S. yield curve starting around 2030 (a repeat of 1942 to 1951), and
4. De-globalization is real, and a new 30 year Cold War has begun, this time with an increasingly nationalistic China.​