US real private GDP rose by 2.3% in 2025, but excluding new era investment, the other 89% of real private spending rose by only 1% with no job creation. The 'larger' old era economy needs policy support! See my latest report at paulsenperspectives.substack.com
Since 1990, stock market leadership has regularly toggled between new era and broader market stocks. As economic policy accommodation finally improves (eg YC steepens), is leadership again toggling back toward broader market plays? See my latest post at paulsenperspectives.substack.com
Thanks to Paul LaMonica & Barrons
for the chance to be interviewed for this weekend's Magazine! Much appreciated. AI and Tech Stocks Are in Trouble. Look to These Other Sectors, Says This Veteran Strategist. barrons.com/articles/ai-... via
@BarronsOnline
Consumer sentiment among Independents has usually moved in the same direction as Republican sentiment. But since late-2024, Republican sentiment has risen while sentiment among Independents has soured. Have Repubs lost Indeps? See my free post at paulsenperspectives.substack.com
Real GDP growth is less than it averaged during the period after the GFC, inflation is just slightly higher, and job growth is significantly worse. Why is the real 2-year yield still 1.88% HIGHER than it averaged then? See my post "Normal Bond Yields" @ paulsenperspectives.substack.com
My latest post introduces a relative Poor/Rich Sentiment Indicator suggesting the S&P 500 may break out of its recent range to the high side. When the Rich lose faith faster than the Poor, it's been a good time to buy stocks. For all the details go to paulsenperspectives.substack.com
Economic policy is finally turning more supportive for the economy and promoting a revival in Main Street confidence. See my latest post on, despite current turmoil, why stock investors shouldn't sell a confidence revival.
paulsenperspectivs.substack.com
I had the great privilege and pleasure of joining
@carlquintanilla, @michaelsantoli, & @CourtReagan
on CNBC @SquawkStreet this morning for a conversation about the economy and the financial markets. Thanks so much for having me! paulsenperspectives.substack.com
www.youtube.com/watch?v=Quja...
Profits have so far remained healthy during this bull run. But some indicators now suggest profit growth could disappoint expectations yet this year. See my latest report which highlights a few such warning signs like the couple shown below. paulsenperspectives.substack.com
The passing of the baton was fumbled in 2000 during the dotcom bull market, but here in 2026, the baton seems to be passing more smoothly allowing broader market plays to run the next leg while avoiding a total collapse in new era stocks. See my latest at paulsenperspectives.substack.com
Yesterday, I had the great pleasure of again joining @practicalquant and @jjcarbonneau from the Excess Return Podcast for another monthly discussion. Click the Youtube link below. Thanks for taking the time to watch the video. paulsenperspectives.substack.com
www.youtube.com/watch?v=WxKF...
Bond Volatility is recently less than 90% of the time since 1990 while stock Vol has remained about average. Stock/bond relative vol is now top quintile which shown by the charts below has been very good for future stock market returns. See my latest report at: PaulsenPerspectives.Substack.com
See my latest report "A Growth Glitch?" at paulsenperspectives.substack.com for a few indicators like the ones highlighted below suggesting real U.S. economic growth may be headed for a period of disappointment. This may cause some volatility but also bring greater policy accommodation.
Conditions in the US job market remain 'recession-like'. The Unemployment Rate has risen by 1% and annual job growth is only 0.37%. However, when job conditions are this feeble, the stock market has typically done well. See the charts below and my latest report @ paulsenperspectives.substack.com
Will JOBS Rule in 2026? When job creation flatlines, hope fades, and policy officials have no choice but to become more accommodative. With NFP YOY slowing to only 0.37% and average unemployment lasting almost 25 weeks, policies need to ease. See my latest post @ paulsenperspectives.substack.com
Although the US has not had a recession since 2020, "fear" of recession has remained high throughout this bull market. Recession risk is finally easing which could significantly alter stock market leadership. See my latest report for sectors set to benefit @ paulsenperspectives.substack.com
Not entirely, those other dates referenced also had severely depressed confidence levels. Major upward moves in the stock market frequently occur when evidence of pessimism and fear are widespread as they are today.
How long before most investors decide to lighten up "LOSERS" like New Era stocks? Smalls win and Tech loses for the last 18 Months! Nearly everyone is overweighted Tech and wonder if its finally time to reduce bets. See my work @ paulsenperspectives.substack.com
Some of the best stock market returns have come when uncertainty was extreme. Simply put, today UNCERTAINTY RULES! So, don’t run for cover … Invest!
See my latest report "Careful what you wish for" @
paulsenperspectives.substack.com
S&P EPS are almost universally expected to increase again this year. However, the continued rising trend in the unemployment rate is telling a much more cautious story about potential profit outcomes in 2026. See my latest full report "Market Messages" @ paulsenperspectives.substack.com
First time on any 1-year trailing period that the Russell 2000 Index has OUTPACED the S&P 500 Index since October 2022. This Bull Market is Changing its Strips!!
See my work @ paulsenperspectives.substack.com
Productivity rises temporarily when the UR rises. Sustained productivity cycles only occur when the UR trends lower. As shown below, despite AI excitement, sustained productivity has been elusive in the contemporary period. See my latest report @ paulsenperspectives.substack.com
TPS (Total Policy Stimulus) has finally been rising for the first time in this bull run. As the charts below indicate, this may awaken "old-era" parts of the stock market like small caps & cyclical sectors. See my latest report "2026 is all about the Policy Push" @ paulsenperspectives.substack.com
Monday, I had the great pleasure of again joining
@practicalquant and @jjcarbonneau from the Excess Return Podcast for another monthly edition. Click the Youtube link below. Thanks for taking the time to listen in. paulsenperspectives.substack.com
youtu.be/4PV5YT3cqXU
See my latest report "New Years Nuggets" for a few economic & investments nuggets (hopefully a few prove golden) to ring in the New Year. Below is one example of an indicator suggesting "Animal Spirits" may take over in 2026. paulsenperspectives.substack.com
Please check out my latest missive which discusses five less followed cautionary signs for new era stocks during 2026 -- which go beyond excessive popularity and high valuations. One example is shown below. See my latest report @ paulsenperspectives.substack.com
Happy New Year!
Please click the link below for my 2026 Economic & Financial Market Outlook. A few thought/guesses on how the New Year may unfold. Thanks!
paulsenperspectives.substack.com/p/2026-econo...
The Fed funds rate has been trailing real commodity prices by about two years since 2020. Should Fed policy remain "lagged & tardy", commodity prices suggest a 2.25%ish funds rate and a 3%ish 10-year yield by the end of 2026. See my latest free report @ paulsenperspectives.substack.com
The SP 500 PE ratio has been high throughout this bull market, but Main Street confidence remains pessimistic, and the stock market keeps climbing. Maybe a better valuation guide is the Emotion-Adjusted PE. For all the details, see my latest report at paulsenperspectives.substack.com
Investors often don't realize that changes in Main Street confidence are just as impactful as changes in EPS. I suspect 2026 will be primarily driven by a confidence revival even if EPS flatten. See my latest for all the details @ paulsenperspectives.substack.com
