Pragmatic capitalist points us to thinking that works for some.
The strategy outlook at JP Morgan is little changed over the last week despite some sobering news out of the labor department last Friday. The bad news on jobs is no longer a surprise to investors and history has shown that past jobless recoveries were dealt with fine by most major asset classes. Although the jobless recovery creates some greater headwinds than most recoveries it is not an immediate headwind as JP Morgan analysts continue to see a flight into equities as portfolio managers chase performance in to year-end.
While many investors (including your truly) have expressed their dislike for the Fed’s liquidity induced “recovery” JP Morgan sees no issues with it. In fact, they see it as a normalization of the allocation of capital in the markets:
Rdan here…this doesn’t look good for the jobless and the main street economy.