Analyst: Don’t ignore robust signs in economy
The notion that the stock market is in an about-to-burst bubble — even as the market sets record after record — is scaring off investors who otherwise stand to see long-term benefits, said a top analyst for Merrill Lynch.
Stocks are in a “secular bull market,” meaning that the long-term trend remains up, in no small part due to the stability of banks in the United States and elsewhere, recovery of the housing market and a sense among many consumers that they can again spend money, said Mary Ann Bartels, head of portfolio strategy for Merrill Lynch Wealth Management.
Recovery by banks and growth again in housing prices have given consumers a sense of security that allows them to spend money, pumping up the economy, Bartels said.
“I can understand that people were unhappy with the bank bailout,” Bartels said, but it has contributed to new stability in the market.
Actually, that stability is not entirely new. The Dow Jones Industrials first came out of the shadows in 2013 and the NASDAQ in 2016, setting the stage for the current upswing.
Still, too many overlook the financial strength of the United States, she said. America remains the world’s financial, entrepreneurial and innovation center, facts that tend to get glossed over in the 24-7 rush of news and hype, Bartels said.
Also lost in that rush is the entrepreneurial spirit of millennials, who are doing much of the reshaping of the world through technology, Bartels said.
They’re not intimated by risk because they don’t see it as such, she said.
Today, though, millennials are making the future, especially the one that their baby boomer elders are entering as they retire.
There’s no time for pessimism because the nation is full of innovators, creators and funders, Bartels said.
“We’re in a beautiful time in history,” Bartels said. “I’m very excited because I can see all this reflected in the equity markets.”
Bartels was speaking to investors at the Avalon Theatre.