November 29, 2017

What’s Up With The Economy?

There is plenty of activity going on in the U.S. and abroad that could impact markets through the end of the year. Potential tax reform legislation in the U.S. continues to get headlines, as Congress works toward the goal of getting a package on the president’s desk by New Year’s. Although passage is far from assured, measures are moving forward. Markets have exhibited sensitivity to tax reform’s prospects, which bears watching.

The third quarter earnings season is also underway, and there’s hope of solid results relative to expectations. Mid-single digit earnings growth would be a good outcome considering insurers’ losses from Hurricanes Harvey and Irma and disruptions to economic activity in Houston and the Florida coast.

President Trump nominated Jerome H. Powell to chair the Federal Reserve, bypassing Janet Yellen for a second term. Powell is expected to stay the course on monetary policy if the economy continues its steady growth.

While it has been a relatively quiet year for markets, with no major pullbacks in the broad stock market it remains important to monitor events that could be catalysts for change. In the midst of the fourth quarter, and with the busy holiday season approaching, Lake Michigan Investment Services will remain mindful of these developments without letting them distract us from long-term goals.