Corporate Beige Book
The biggest question in people’s minds right now is whether the U.S. economy is headed for a recession, which would almost certainly be accompanied by a bear market decline for the S&P 500. But that outcome is unlikely based on what we have heard from corporate management teams this earnings season. In fact, corporate America (and analysts on the conference calls) have not worried about a recession for quite a while now [Figure 1], with only between 5 and 12 mentions during the past five quarters (through six weeks of earnings reports). The lack of attention for the “R” word is partly a reflection of managements’ desire to convey optimism, but also likely reflects confidence in continued economic growth.