By: Matt Garrott

The S&P 500 broke through to new all-time highs for the first time in 512 trading days (over two years).  As mentioned in our year-end commentary, all-time highs are not ceilings.  Research from Goldman Sachs shows that this is only the seventh time the index has taken over two years between new highs.  When it takes that long, the S&P 500 averaged a 13.1% return over the following 12 months.  That’s not to say that we expect outsized returns going forward, but that hitting all-time highs is a good and natural part of the market cycle.

Despite a strong 2023 from the S&P 500 and new highs in January, Wall Street’s product sales teams say you could have done better and you’re now in immediate danger.  They say you need to buy their latest product to solve problems you don’t have.  Sound familiar?  We’ll be hearing similar anxiety-inducing messages through November from politicians of all stripes.

Economic data is all over the board.  Experts who normally persuade their audience sound like they’re trying to persuade themselves to believe in their own positions.  Payrolls show massive gains, but hours worked are up a fraction of that.  Hourly earnings are up, but that’s at least in part to hours worked per worker decreasing.  Credit card debt is at $1.1 trillion, but relative to money families have in the bank, it’s near its lowest point in 20 years.  There is one expert who is not in doubt and he is laser-focused on only one data point: Punxsutawney Phil.  He may not have seen his shadow, but I’m not putting my snowblower away just yet.