Geopolitical concerns abound and a Presidential election lie ahead of us; the remaining eleven months will likely make 2024 a very interesting year.

The consensus view of Wall Street strategists at the beginning of 2023 had it all wrong. Instead, the economy defied those expectations and solidified a new bull market that charged forward in a remarkable comeback.

“Inflation is created by government and by no one else,” economist Milton Friedman famously stated almost fifty years ago. It especially rings true today.

As we enter 2 of the best performing months in a typical year, the Fed has not yet completed its mission to return the US inflation rate to 2%.

Consumers are revenge spending. Beyonce & Taylor Swift concert tours made material impacts on traditional economic data. European travel is peaking.

Overall, the economy has continued to defy expectations of a recession due to resilient consumer spending and a tight labor market. Investors have benefited. However, core inflation remains too high and the full impact on business investment from the Fed’s tightening may not have been realized yet.