Hello, Subscribers:
The University of Michigan’s Surveys of Consumers is a treasure trove of revealing visuals on the state of America’s collective household mindset. It recently released a 122-page chartbook and one of the more interesting graphics, in my view, is shown below.
There are two aspects that grabbed my attention. The first is the most obvious: Namely, that consumer expectations are at levels previously only seen during, or soon after, outright recessions.
What is less immediately apparent but truly unprecedented is that the U.S. stock market is at an all-time high despite this glum outlook. In the past, these types of rock-bottom readings were associated with major equity price declines either leading up to the recession or occurring during one.
This is another example of how unusual current circumstances are and the extreme difficulty of using past precedents to anticipate future conditions. In so many ways, we have entered uncharted waters both for the economy and financial markets.
David “The Haymaker” Hay
IMPORTANT DISCLOSURES
This material has been distributed solely for informational and educational purposes only and is not a solicitation or an offer to buy any security or to participate in any trading strategy. All material presented is compiled from sources believed to be reliable, but accuracy, adequacy, or completeness cannot be guaranteed, and David Hay makes no representation as to its accuracy, adequacy, or completeness.
The information herein is based on David Hay’s beliefs, as well as certain assumptions regarding future events based on information available to David Hay on a formal and informal basis as of the date of this publication. The material may include projections or other forward-looking statements regarding future events, targets or expectations. Past performance is no guarantee of future results. There is no guarantee that any opinions, forecasts, projections, risk assumptions, or commentary discussed herein will be realized or that an investment strategy will be successful. Actual experience may not reflect all of these opinions, forecasts, projections, risk assumptions, or commentary.
David Hay shall have no responsibility for: (i) determining that any opinion, forecast, projection, risk assumption, or commentary discussed herein is suitable for any particular reader; (ii) monitoring whether any opinion, forecast, projection, risk assumption, or commentary discussed herein continues to be suitable for any reader; or (iii) tailoring any opinion, forecast, projection, risk assumption, or commentary discussed herein to any particular reader’s investment objectives, guidelines, or restrictions.
David Hay is a passive owner of Evergreen Gavekal (“Evergreen”), a registered investment adviser with the Securities and Exchange Commission. As of 03/31/2025 Mr. Hay has no involvement in the day to day operations of Evergreen, nor is he involved with any investment research, or investment management performed by Evergreen. The information herein reflects the personal views of David Hay as a seasoned investor in the financial markets and any recommendations noted may be materially different than the investment strategies that Evergreen manages on behalf of, or recommends to, its clients.
Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this material, will be profitable, equal any corresponding indicated performance level(s), or be suitable for your portfolio. Due to rapidly changing market conditions and the complexity of investment decisions, supplemental information and other sources may be required to make informed investment decisions based on an individual’s investment objectives and suitability specifications. All expressions of opinions are subject to change without notice. Investors should seek financial advice regarding the appropriateness of investing in any security or investment strategy discussed in this presentation.
Relevant to restaurants, hotels, cruise lines, airlines, retailers, plus tickers like LYV. They’re all in for a rough patch.
In my view outperformance of the equity markets in the face of a slowing economy is a reflection of our nations burgeoning wealth gap. The vast amounts of new money in the last five years, most of it captured by a small minority, would probably account for much of this phenomenon. BTW, thank you very much for making your thoughts available in front of the paywall. I follow and appreciate you greatly.
Mike Gentry