Stocks Face Growing Risks Despite Wall Street Optimism
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The stock market seems overly optimistic despite risks like inflation, rate hikes, and geopolitics. Stocks are pricing in "irrational exuberance."
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Interest rates on bonds like the 10-year Treasury are now very competitive with stock returns. Stocks need to justify high valuations.
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The Fed has less influence over the economy than people think. If the economy heads in a direction, the Fed can't do much.
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Consumers are tapping out credit cards and loans to keep spending, not necessarily showing resilience.
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Companies embracing AI don't automatically benefit. Microsoft strategically acquired OpenAI, boosting cloud business.