There's a very big divergence in both the stock market as well as the economy ... and it's been getting worse.
That said, at the moment, we do not see enough evidence to suggest that a recession is right around the corner. In today's video, we review a couple of economic data points that - in our view - do NOT suggest a recession is near.
However, there is an argument that many companies have been struggling with a mini - or undeclared - recession and that is why we have seen such a large divergence in the markets. However, since the Federal Reserve has started to ease (by lowering interest rates), there is an argument that this divergence is going to be resolved in a positive fashion.
Regardless, the divergence cannot continue indefinitely. If it resolves in a negative (downward) fashion, we like our process. If it resolves in a positive (upward) fashion, we like our chances in that environment as well. As a result, we will simply continue to follow our investment management process.
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