The bull market continues to defy the skeptics and is now nearing a major milestone. On August 22, 2018, this bull market can overtake the bull market of the 1990s as the longest ever. From tariffs to trade wars to inflation to a flattening yield curve to a global economic slowdown, the headlines continue to cast doubt on the sustainability of this economic cycle and bull market. Although we see several potential stumbling blocks, we continue to believe this economy and stock market rally have plenty of fuel left in the tank.

Major Milestone

The current bull market was born on March 9, 2009, and is now just days away from topp

As the U.S. economic recovery moves into its later stages, inflation has emerged at a surprisingly slow and inconsistent rate, befuddling investors who have watched the expansion set the stage for anticipated price and wage growth. Only recently has data emerged indicating that pricing pressures have approached, and in some circumstances exceeded, target levels from monetary policymakers.

Inflation is a focal point of the Fed’s evaluation of economic health when determining future monetary policy. However, the absence of inflation in the recovery has apparently stumped even the Fed, which incorporated a variety of innovativ

The Fed announced last Wednesday that it would keep interest rates unchanged, a decision that markets largely expected. In its statement, the Fed upgraded its view of the economy to growing at a “strong” rate for the first time since 2006, a view encapsulated by last quarter’s strongest gross domestic product (GDP) growth since 2014. Fiscal stimulus has fueled strong business, consumer, and government spending, and the job market has continued to tighten, with the unemployment rate sitting at its lowest point of the expansion.

Economic Growth Supports Higher Rates

In a vacuum, the macroeconomic backdrop suppo

Healthy Job Gains Despite Missing Expectations

The Labor Department’s July jobs report, released on Friday, August 3, confirmed that the labor market remains healthy. Nonfarm payrolls rose 157,000 in July, below consensus expectations for a 193,000 increase; however, an upward revision of 59,000 jobs for May and June more than offset the July miss and helped paint an overall picture of a healthy job market. With the revisions, job growth for May and June averaged 258,000, the strongest two-month period since July 2016. These strong summer months lifted 3-month average payroll growth to 224,333 and 1-year average payroll gro