Broker Check

Looking Ahead: Confidence in the Future of the U.S. Economy

September 14, 2023

In the dynamic world of our economy, it’s crucial to stay informed and prepared. While we’ve navigated some challenges in recent years, these periods often set the stage for new opportunities and growth.

There are several recent developments that suggest a positive outlook for the U.S. economy:

  1. Economic Expansion: Fundstrat’s Tom Lee has identified five green flags1 that could drive the US economy into an expansion this year. These include a robust job market, dropping inflation expectations, falling rent prices, Treasury Secretary Janet Yellen’s optimism about the economy, and decreasing stock market volatility.
  2. Business Optimism: A recent poll by NFIB2 indicates growing optimism among business leaders, which could lead to increased business investment and economic growth.
  3. Positive GDP Growth: The U.S. economy grew at an annual rate of 2.0 percent in the first quarter of 2023, and it increased at an annual rate of 2.1 percent in the second quarter3.
  4. Strong Dollar: The US dollar is projected to maintain its strength throughout this year, showcasing the robustness of the U.S. economy, as per a Reuters poll of analysts4.

These developments paint a promising picture for our economic future, demonstrating resilience and potential for growth despite recent challenges.

Now, it’s also important to be mindful of potential challenges on the horizon. The Federal Reserve is expected to raise rates a few more times5, which could introduce further volatility in the stock market as these changes may not yet be fully priced in. Additionally, with the 2024 Presidential elections on the horizon, we can anticipate added short-term volatility due to potential future policy changes and uncertainty6.

Despite these challenges, periods of high interest rates can present opportunities for certain types of investments like annuities, CDs, and high yield savings accounts to be more attractive with higher rates of return and with higher rates of protection. Moreover, volatility is not necessarily a negative aspect either. In fact, it can provide opportunities for investors who are guided by their long-term goals and sound financial & investment plans and strategies.

As your financial planner and investment manager, my goal is to help you navigate these changes and identify opportunities that align with your financial goals. Sticking to long-term goals is key during these times of volatility and uncertainty.

If you have any questions or concerns about your current financial plan or how these economic updates might impact your financial future, please don’t hesitate to reach out.

Also, if you know anyone — friends or family — who are concerned about the economy or unsure about their investments or financial plans, please feel free to give them my information. I would be more than happy to have a discussion with them to see how we can create or improve a financial plan for their specific goals.

As always, I am here to answer any questions you may have and look forward to our continued partnership.


References/Sources:

  1. Fundstrat’s five green flags
  2. NFIB poll
  3. US GDP 2023 | U.S. Bureau of Economic Analysis (BEA)
  4. Dollar to stay bright this year before fading in 2024, Reuters poll of analysts shows | Reuters
  5. Potential rate hike
  6. How Presidential Elections Affect the Stock Market | U.S. Bank (usbank.com)