Earnings!

Finally, investors are starting to get first-quarter earnings reports from public companies. Rather than guessing, we can all start to see what is going on. Unfortunately, the Bull and his partners suspect that most companies will be very circumspect about their immediate and longer-range prospects. So, as much as we would all like to begin to connect dots and have more to make forecasts, we are all likely to be disappointed.

What investors are seeing so far is that public managers are unable to give any reliable forecasts as to their own prospects. Uncertainty is the word of the day! No one has any way to predict what major economic policies are coming or even whether what we have seen will persist. Consequently, businesses are reining in investment plans and turning cautious. As investors, we are all on our own.

Clearly, the economy is slowing. Tariffs will not help. Inflation may pick up as producers seek to pass additional costs to their customers. So, what to do? Does this sound bleak? The good news is that much of this is already factored into stock prices. Our stock market peaked last November and has been correcting since. It is just that we can now see why. At some point, price reflects more opportunity than risk. The Bull believes we are close to that point. Stay steady my friends!

-The Lonely Bull