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JPMorgan’s New S&P 3,000 Call And A Warning From Kolanovic
Look, JPMorgan is out with their year-ahead outlook for equities and the bank is bullish. Imagine that.
In fact, they're significantly more bullish than consensus which, at least as of a week or so ago, was S&P 2,800 by year-end 2018. "After two consecutive years of multiple expansion with S&P 500 PE re-rating by ~2 turns to 18x (NTM), we believe valuation will likely remain elevated and expect S&P 500 to reach 3,000 by YE 2018," the bank writes, in a note dated Thursday.
On the of
I do not think you should really be calling the taxation changes being proposed in Washington “tax reform”. A bald face tax cut and profit expansion (via lower corporate taxes) for the rich does not merit that term.
I expect that much of the corporate tax cut will be drop-shipped to the C-Suite, then some used for dividend increases and share buybacks, with plenty left sloshing around for ill-timed and illogical M&A and general gross mismanagement, leading to the next financial crisis. But that’s just me.
It’s getting a lot warmer in the pot for us frogs. With well over a 5% inflation rate for the lowly us out in the real world and this tax scam which is right in your face, the water is heating up all the faster. A passage of this tax theft by an amoral republican congress and then it’s “Miller Time” for the gutting of all safety nets, because sooo much $$$ is wasted on real people (as in living breathing people) and nothing is wasted on our wars, corporate welfare, bank bailouts, government waste and abuse of OUR hard earned tax money.
Here is a concept, everyone fills out a legal IRS form to delay all taxes until the following April 15th. Yes, you can legally hold ALL that money owed in a bank account and not pay it until you absolutely HAVE to. Will anyone start listening then????
Me thinks JP could be right on this call. I believe I read BofA was throwing out similar numbers also. The search for yield is a powerful thing. Equities are delivering at the moment, and as Kolanovic stated, “asset classes may not react immediately” to the changing liquidity tide. Many habits have been developed over the last 8 years… habits are hard to break. Even for institutional investors.