Fidelity Investments is generally positive about the near-term prospects for the US economy, and identifies several good indicators:
- corporate profits are stronger than expected and growing
- consumers are still sitting on a lot of cash, built up during low pandemic spending, and starting to spend more on both goods and services
- the job market is healthy for workers and unemployment is low
- the prospect of declining inflation (eventually) as supply-chain disruptions diminish and the Federal Reserve raises rates
In addition, the annual US government deficit, while still high, has gone down from pandemic-spending levels, and the government actually had a surplus in April 2022—the largest in history—because of higher revenue and lower spending.
Often the headline news we read or watch relates to world or political events that might be very troubling. But the economy and corporate performance are often unrelated to the news of the day. Right now, that seems especially true.
This information is of a general educational nature and not investment advice. Past performance is no guarantee of future returns. Investing involves the risk of loss. A diversified portfolio does not guarantee a gain or protect against a loss. Information in this post is believed to be accurate but may contain inadvertent errors.