QVMS - Weekly Market Pulse: Time For A Taper Tantrum?

• Regardless of what happens with the economy and bonds over the rest of the year, we are nearing peak exuberance in stocks.
• Most people fear that a slowing economy will be the trigger for a stock market selloff, but that may be the wrong worry. Bear markets are generally associated with recession, and there just isn’t any indication we are close to that kind of outcome. But corrections can be triggered by just about anything.
• Our baseline expectation is for the economy to eventually return to the slow growth that prevailed pre-COVID. In fact, considering the debt we’ve added since March 2020, I’d say growth slightly less than pre-COVID makes sense.

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