GDP Jumps 6.4% in Q1, Double-Digit Home Price Appreciation, and Earnings Beats Hit New Record
April 30, 2021 | FIRESIDE CHARTS
U.S. GDP climbed by 6.4% in Q1, inching the economy closer to full recovery. While spending on services is finally accelerating—it grew 4.6% over the quarter—spending on goods remains dominant and climbed by 23.6% quarter-over-quarter. Much of that spending was a natural consequence of the housing boom, but double-digit home price appreciation is pricing large swaths of the population out of the market. Over in the equity markets meanwhile, earnings beats are at a record and many money managers are feeling bullish about the next 10 years. But important threats—including inflation and near-zero rates—remain, particularly when it comes to the traditional 60/40 portfolio.
1. “I think I can, I think I can…” If and when we get enough people vaccinated, the remaining sectors should join in the recovery:
Source: The Daily Shot, from 4/30/21
2. GDP growth was largely driven by consumer purchases. Renovations, additions and new homes now need furniture and other “stuff” in them:
Source: The Daily Shot, from 4/30/21
3. The surge in home prices is widening the affordability gap:
Source: The Daily Shot, from 4/29/21
4. Post-pandemic earnings beats are setting record highs:
Source: The Daily Shot, from 4/30/21
5. Lions (tax hikes), tigers (inflation, rising interest rates), and bears (mean reversion) or simply continuation bias? Most 60/40 type models are counting on 9% or higher…
Source: The Daily Shot, from 4/29/21
6. The Fed confirmed near zero rates until 2022. Money markets will struggle as massive liquidity (money supply) drives short-term rates to…near zero…
Source: The Daily Shot, from 4/29/21
7. The trend continues; good news for our farmers, bad news buying food:
Source: Bloomberg, from 4/29/21
8. Will new, green energy demand keep “Dr. Copper” prices rising?
Source: The Daily Shot, from 4/29/21
9. Europeans have joined the rosy future camp:
Source: The Daily Shot, from 4/30/21
10. The Canadians, known for their conservatism, have started QE reversal:
Source: The Daily Shot, from 4/30/21
11. The big get bigger…
Source: The Daily Shot, from 4/30/21
12. Sorry to be “Debbie downer” on a Friday, but the press has given us reasons to be complacent. Covid is rampant around the globe with ~900,000 new cases every day. Before it boomerangs back here, PLEASE get vaccinated!
Source: JHU CSSE, as of 4/30/21
Disclosure: The charts and infographics contained in this blog are typically based on data obtained from 3rd parties and are believed to be accurate. The commentary included is the opinion of the author and subject to change at any time. Any reference to specific securities or investments are for illustrative purposes only and are not intended as investment advice nor are they a recommendation to take any action. Individual securities mentioned may be held in client accounts. Past performance is no guarantee of future results.