Washington D.C. analyst Greg Valliere has followed the intersection of business and politics since the 1970s and he’s never seen anything like the current wave of what he calls “chaos and dysfunction” coinciding with a stunning bull market in stocks.
A frequent guest on Bloomberg and CNBC networks, Valliere has worked as a global equity strategist for Charlotte-based Horizon Investments for the last two years. He caught my eye with a recent prediction that there is a 20% chance of war with Korea. So I called him up and he told me it’s more important to focus on the 80% odds of avoiding conflict.
His big picture view: “Investors need to divorce themselves from the Washington nonsense and focus on the economy. It’s hard to get fundamentals any better than we have right now. There’s modest inflation, very strong corporate profits, steady interest rates, GDP growth of 2.5%. The word ‘Goldilocks’ is not an exaggeration.” While Valliere credits outgoing Fed Chairwoman Janet Yellen for steering much of that success, President Trump’s pro-business, anti-regulatory stances are also sparking stock gains, he says.
“For all the president’s flaws, his cabinet is much more pro business than Obama’s. The president likes the chaos that comes from all of these tweets, but for the investment world, it is largely irrelevant.
Valliere sees no recession in sight and predicts new Fed Chair Jerome Powell “won’t rock the boat.”