The Most “Horrifying” Chart in the World by Justin Spittler
Larry Fink is terrified.
Fink runs BlackRock, the world’s largest asset manager. The company manages a whopping $5.1 trillion. That’s more than Goldman Sachs, Bank of America, or Wells Fargo. It’s more than the annual economic output of Japan, the world’s third-largest economy.
This makes Fink one of the most powerful people on the planet.
Obviously, you don’t climb to the top in Wall Street by being easily rattled. But right now, Fink’s nervous.
He’s worried about “a lot of dark shadows that could impact the direction of the marketplace.”
• Fink’s especially worried about consumer confidence…
Consumer confidence measures how everyday people feel about the economy and their own financial situation.
It’s subjective. You can’t measure it.
That’s why some investors don’t take it seriously. But they should.
After all, sentiment is what really drives stocks. It’s far more important than earnings, valuations, or the health of the economy. It’s why stocks can rally despite serious fundamental problems.
According to a recent survey by the University of Michigan, consumer confidence has been climbing since 2011. It recently hit the highest level since 2004.
• Americans have good reason to be confident…
After all, we just elected our first “investor” president.
Unlike Obama, Donald Trump wants to put American businesses first. He also wants to cut taxes, ease regulations, and rebuild American infrastructure.
These policies should help U.S. companies and workers.
That’s why Americans are so confident. It’s why the S&P 500 has rallied 9% since Election Day. It’s why the Dow Jones Industrial Average just topped 20,000 for the first time ever.
You can clearly see Trump’s impact on stocks in the chart below. You’ll also notice that consumer confidence hasn’t been this high since just before the 2008–2009 financial crisis.
• Thanks to Trump, greed is in the air again…
But this isn’t a good thing.