“I haven’t the faintest idea as to whether stocks will be higher or lower a month or a year from now. What is likely, however, is that the market will move higher, perhaps substantially so, well before either sentiment or the economy turns up. So if you wait for the robins, spring will be over.”
Warren Buffet, 2008
Good evening:
In recent weeks, many stocks have fallen, spooking investors that maybe 2023’s hot start won’t last. Tom Lee has acknowledged that gains will be limited in the short run into March. But there’s no thesis change to his bullish 2023 outlook: Inflation will cool into the summer. Said Lee this week:
“If you look at the 14 rate cycles that lasted more than 12 months, 11 out of the 14, markets rallied into highs with the hikes. The two exceptions were (under Arthur F. Burns, 1970-78) who was higher in a hurry. Once (Paul) Volcker became fed chair, hikes were associated with higher stock prices. With (Alan) Greenspan, there were five cycles of his raising. Five of five times markets marched higher to all-time highs.
“So, unless Powell is invoking his inner Burns, I think the stock market is going to appreciate data dependence,” Lee added.
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