The Flinchum File

Thoughtful Economic Analysis and Existential Opinions
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2018 — Good or Great ?

Bob Doll is the chief equity strategist at the giant investment firm of Nuveen.  He is generally bullish and has a good track record on his predictions, which I have studied for years.  Generally speaking, he expects the economy to be stronger than the stock market in 2018.  His ten predictions are:

1.  For the first time in a decade, real GDP in the U.S. rises 3% this year.
2.  Fewest number of countries in history will be in a recession this year.
3.  Unemployment will be the lowest in nearly 50 years, while wage growth will be strong.
4.  The difference between long-term and short-term continues to drop, as short-term rates rise faster than long-term rates.
5.  A 5% correction in the stock market is overdue.
6.  The S&P 500 will end the year at 2,800 — up 7%
7.  Stocks will beat bonds for the seventh straight year, which hasn’t happened in a century.
8.  Share buybacks will decrease, while corporate capital expenditures will increase.
9.  Telecom, information tech, and health care stocks will out-perform utilities, energy, & materials.
10. Republicans will lose the House in November and “further distance themselves from Trump.”