Stay up to date on current financial events and commentary with our weekly blogs.

Greedy Innkeeper or Generous Capitalist? The Bible story of the virgin birth is at the center of much of the holiday cheer this time of year.

Good News is Good News. It’s no wonder that the stock market liked what it saw on Friday, a robust job market and healthy economy, and lifted the S&P 500 to its second-highest close on record, just off the November 27 all-time high. Only sixteen trading days remain this year (including today) and, as of Friday’s close, the S&P 500 is only 3.3% off our target of 3,250 for year-end.

S&P 3650, Dow 32,500. Needless to say, we don’t see a recession anytime soon. The economy is still adapting to lower tax rates and monetary policy remains loose. In addition, home builders are still generating too few homes given our population growth and scrappage rates, while banks are sitting on ample capital.

Black Friday- Don’t Worry About the US Consumer. Early reports say Black Friday on-line sales hit a record high, up 14% from a year ago, following a 17% increase on Thanksgiving Day itself. Black Friday sales at brick and mortar stores were up 4.2% from a year ago. So much for the theory that brick and mortar is dead or the economy is in trouble.

Giving Thanks. What an incredible time to be alive! We stand just five weeks from the end of a decade that saw prosperity spread far and wide. Some don’t see it that way, as pouting pundits and rancorous politics skew our visions. But, if we simply step back from the day to day noise and take in the magnitude of progress around us, there is a great deal to be thankful for.

Long Live the Bull Market. Stocks are still cheap, the economy is not slipping into recession. The policy environment is tilted more toward growth than it was three years ago, even though it could be better. And that means the bull market should continue.

Income Inequality, Taxation, and Redistribution. One of our favorite economic parables is the Fish Story, from Paul Zane Pilzer’s 1990 book, “Unlimited Wealth.” It is an excellent tool for thinking about wealth creation, inequality and redistribution.

No Recession on the Horizon. One by one, the pessimistic theories have been proven wrong. Yes, the US will eventually fall back into a recession. But we don’t see it happening this year or next, and probably not in 2021, either.

Another Fed Rate Cut on the Way. In our opinion, this rate cut is completely unnecessary. The unemployment rate is 3.5%, much lower than the 4.2% that Fed policymakers think it will average over the long run. Nominal GDP – real GDP growth plus inflation – is up 5.0% annualized in the past two years, well above the level of short-term rates. The M2 measure of the money supply is up 6.5% from a year ago, a healthy acceleration from the 3.4% increase the year before.

More Tepid GDP Growth in Q3. Given that the economy grew at a tepid 2.0% annual rate in Q2, we’re sure you’ll hear plenty of angst about slow growth. But we don’t believe these past quarters represent a permanent shift to slower growth.