Market Update – November 01, 2019

We have been making the case that the U.S. economy is doing just fine and the equity market is not overvalued by conventional metrics. This week it was announced that the U.S. economy grew at an annualized pace of 1.9%, above what most economist thought. On the market side, the S&P 500 is trading at 16.7x next year’s earnings; the 25-year average is 16.22x[i]. We have positive growth in the economy and the markets are healthy, therefore we don’t think a recession is likely in the near term.