11 Reasons To Be Bullish In 2011

Via Liz Ann Sonders at Charles Schwab:

  • Taxes are not going higher, while the bill also includes a payroll tax reduction and immediate and full expensing for business investment.
  • Leading indicators have reaccelerated and manufacturing is expanding at a seven-month-high pace.
  • Initial unemployment claims have significantly broken out to the downside.
  • Credit conditions are improving markedly for both consumer and commercial loans.
  • Real consumer spending is back in expansion mode, having surpassed its 2007 high (ahead of GDP doing the same).
  • Earnings growth remains high and steady, keeping valuations reasonable.
  • Core inflation remains contained.
  • Merger-and-acquisition activity is picking up sharply, especially among technology and energy companies. You can read more about sectors from Brad Sorensen.
  • Long-term yields are up, but short-term rates are low and steady; lending support to the economically important steep yield curve.
  • QE2 is having success boosting asset prices and should offset some of the recent drag on the savings rate while boosting household net worth and confidence.
  • The election cycle greatly favours the pre-election year (2011), with an average annual gain of over 17% for the S&P 500® index and no down years since 1945.

Source: Schwab

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