June 5, 2025
By Peter Bower
The Bull has written many times about the ongoing back-and-forth competition between the growth and value sectors of our stock market and economy. In the first part of this year, returns came mostly from value stocks while growth stocks corrected. Now, that pattern has reversed. Growth is back. Why?
Once investors become concerned about economic growth, they return to those companies that seem to be able to advance their earnings in almost any kind of environment. Big tech and the myriad of firms that support their efforts become, once again, the haven investors look for. The stock market may go through another mini-growth scare soon. We have had several over the past few years.
A growth scare seems probable given all the uncertainty thrown at the economy by rapid changes from the new presidential administration. However, the Bull and his partners feel that this will be more of a scare than reality. Remember all the potential positives cited in the Bull’s blog last week. These included huge new investments in artificial intelligence (AI), the potential benefits of applying AI, and the reshoring of important manufacturing, among others.
So whatever doubts and concerns develop for economic growth, they should not be long-lasting. The flow of money into many sectors in the economy will continue to drive many sectors, mostly growth ones, forward. In the meantime, stay steady my friends.
-The Lonely Bull
