https://www.frbatlanta.org/cqer/research/gdpnow
an interesting divergence here. the fed estimate is going up,
but the blue chip forecast is flat, and going nowhere.
which one is more accurate, and why?
Very interesting indeed!
Is this already dialed into stocks?
So if GDP growth was only half the prediction, failing to meet expectations........stocks would go down?
It seems to me that GDP has little to no influence on stk price
What really matters is liquidity injections
Many people have written about the bottom 90 % receiving very little relief from gov't stimulus
Many have agreed the 1200 dollar cheque plus enhanced unemployment benefits did help and more is needed
But many problems exist such as evictions, even with stimulus, the rent is too far in arrears, food lines never before seen in such quantity or numbers, land lord facing mortgage default, the list goes on
One has to agree housing did very well in some places and stks did very well. Some even managed to pay down car loans, credit card
CEO's got a larger increase in wages vs the average salary over the past 10 yrs.
In other words you had winners and losers. Nobody knows if that 90/10 % split is accurate but it is close
So where in all this did GDP affect stk prices
IMO liquidity and momentum affects stk prices not GDP or stks would be down at least on those who do not have P/E ratio sufficient to warrant the stk price. Is Tesla worth ?? of is this momentum buying
The Fed is convinced QE and/or stimulus injections will keep the economy afloat until we cure this covid problem
No where do I find a sustained correlation between GDP and stk prices,
My final question and most important
Where will the buyers come from other than Fed/gov't liquidity injections, when most are all in, or put another way [most are on the same side of the boat]
So: What ever the stk market does, I don't think GDP has a nickels worth of affect