Pro Perspectives 4/5/21

April 5, 2021

We had a hot March jobs report on Friday, to kick off the new quarter. 

Looking back on Q1, we had an economy that is estimated by the Atlanta Fed to have grown at a 6% annual rate.

With that, the banks will kick off earnings season next week, and we will begin to see what 6% economic growth looks like in corporate earnings.  And those earnings will be compared to against against a very low base of Q1 2020 — the quarter that included the onset of the pandemic and economic shutdown.

Spoiler:  The earnings growth is going to be huge. 

On a related note, even though the estimates on earnings have been ratcheted up by both Wall Street and corporate America, history tells us that earnings estimates are set to be beaten.  We should expect to see big positive surprises from the first quarter.  That will all be more fuel for stocks.

And this comes in the month of April, which historically is a very good month for stocks (up 15 out of the past 15 years).         

Keep in mind, this first quarter includes just a small fraction disbursed of the latest $1.9 trillion.  With more of this money hitting in the coming quarter, Q2 growth (in GDP and corporate earnings) is going to be mind-blowingly big.  The corporate earnings will be measured against the deep trough of the economic recession.   

Add to this, we will probably see a Biden "infrastructure"/clean energy bill work its way through Congress in the second quarter (another $2+ trillion lined-up for the economy).  Stocks are up 7% year-to-date, and will continue to float higher on this sea of liquidity. 

I'm away for the remainder of the week, spending Spring Break with the family. You won't see a Pro Perspectives note from me until next Monday. 

In the meantime, to best position for a continuing stock market boom, sign up here and take a look through my actively-managed portfolio of undervalued stocks — all of which are vetted and owned by the best billionaire investors in the world. Listen to my recorded "Live Monthly Portfolio Reviews."  Read all of my past notes to my subscribers.  Take it all in.  If you find that it doesn't suit you, just email me within 30 days and I will refund your money in full immediately.

Have a great week!