On a rare sunny evening in May, AOG hosted our annual Mid-Year Economic Update at the lovely 2941 Restaurant in Falls Church for our clients and their friends. This year we were honored to host First Trust’s Chief Economist Brian Wesbury as our keynote speaker.
Brian Wesbury was recently named the co-winner of the Forecaster of the Month honor for April 2018 by MarketWatch.com, along with his Deputy Economist Bob Stein (AOG’s Mid-Year Economic Update speaker for 2017). Mr. Wesbury wrote the book It’s Not As Bad As You Think [c. 2009] and he shares his economic analysis weekly through his Monday Morning Outlook blog and his Wesbury 101 – Economic Video Commentary. (Links to his economic commentary and other market commentary can be found in the Media Room on our website.)
Mr. Wesbury delivered an astute presentation about the current state of the economy and provided the audience with numerous examples of a healthy and growing market. He made the case for the stock market by highlighting its ability to outperform other asset classes over the long-term. The corporate sector’s increasing importance in contributing to GDP growth along with stronger underlying factors which could boost corporate profits in the future were just some of the supporting arguments presented in favor of a higher overall market level. Wesbury pointed to growing real-business investment spending as a percentage of GDP; innovation from business owners and overall productivity growth as key drivers to help explain the strong state of the labor market and the historically low unemployment rate.
In addressing some of the major obstacles for the economy Wesbury focused on the growing non-defense government spending rate and increasing social costs and highlighted how the private sector should be allowed to operate in a less restricted environment. He saw recent changes to deregulate as a step in the right direction which could assist small business owners to fully participate in the expanding market environment. Whereas many market commentators have expressed some concern over recent federal funds rate hikes, Mr. Wesbury pointed to longer term trends in the nominal GDP growth rate to clarify his view that interest rates still have some room to move before becoming a cause for alarm. Considering the overall view of the market; current stock market valuations and First Trust’s Capital profits model Wesbury concluded that the market still holds upside potential and, in his opinion, still present a justifiable investment opportunity.
We thank Mr. Wesbury for coming to Virginia to share his economic outlook with us. AOG Wealth Management hosts about seven education events a year for our clients and the Mid-Year Economic Update is always quite popular.
Pictured L-R: AOG Advisor Michelle Whitlock, Brian Wesbury, and AOG Analyst Wiehan Peyper