00:00Ed Yardeni of Yardeni Research, writing, equity investors certainly have reason for optimism.
00:05Ed joins us now for more. Ed, welcome to the program. Let's get to those reasons. What are they?
00:09Well, first and foremost, as the Middle East situation has calmed down, the war isn't over.
00:16There's a ceasefire. It may or may not take six months to get a full peace agreement. But
00:22the main point, as you said, is the bombs aren't dropping and things are calming down.
00:27Then, of course, secondly, earnings have been on fire. We've had earnings led melt up in the stock
00:34market for a while, actually. And as the war occurred, the earnings expectations continue to
00:43increase at a faster pace. So the analysts didn't get the war memo and they didn't get any feedback
00:49from the companies they follow that this is a concern for earnings anytime soon.
00:55Ed, we're getting some feedback from the equity markets, some clear feedback. The enthusiasm for
01:00tech again is overwhelming. The 12-day run on the NASDAQ 100. Within tech, it's not just chips.
01:05We're seeing the likes of Microsoft, which at one point was really, really struggling. Have a fantastic
01:10week as well. Ed, what's behind that renewed enthusiasm for that tech trade?
01:14Well, in two words or three words, the roaring 2020s. You know, there's a lot of similarities
01:23between the current decade and the 1920s. The big one is technologically led productivity gains,
01:31which increases the purchasing power of consumers. We're seeing that. It increases the growth rate of
01:38the economy. I think we saw that most of last year. I think we had some weakness in the fourth
01:45and first
01:46quarters. I blame that on the weather. So I expect to see. Remember Chauncey Gardner from being there?
01:52I expect in the spring there will be growth. I think we're going to see a tremendous growth. And really,
01:58the economy's resilience has been phenomenal and therefore earnings have been phenomenal.
Comments