According to the latest data, Americans are feeling very good. In fact, the best they've felt in 16 years!
This aligns with the message coming from a variety of leading economic indicators and, as we showed last month, the LEIs are currently not warning of an imminent market peak or recession.
With Americans across the country more upbeat "about the state of the economy, their personal finances and the buying atmosphere," Bloomberg notes, we still see a generally favorable backdrop, despite an expected August-September downturn, which may be underway as we speak, and our general posture to wait for another buy signal.
Will consumer comfort take a turn for the worse?
Further Fed tightening may begin to exert pressure on the market and economy in 2018 leading to a recession in the late 2018, early 2019 time period. A possible roadmap for the end of the current bull market and economic expansion was explained in our recent newsletter, Preparing for the End Game.
In terms of monitoring Bloomberg's Consumer Comfort measure for signs of an economic contraction, investors should look for a significant reversal on slowing momentum shown by the second panel in the chart above.
