Markets stocks

Goldman Sees ‘Roaring ‘20s Redux.’ S&P To Hit 4,600 In 2022

"A vaccine is a more important development for the economy and markets than the prospective policies of a Biden presidency," David Kostin wrote, in the very first line of Goldman's 2021 US equity outlook entitled "Roaring '20s Redux." For Kostin, Pfizer's vaccine (or really just a vaccine) should "allow society to gradually normalize during 2021." When you factor in the assumed benign read-through for equities from divided government and a number of additional assumptions, Goldman said you can expect the S&P to hit 4,100 by mid-2021 and 4,300 by the end of next year. By the end of 2022, the index will be perched at 4,600, Kostin projected, in the new outlook, dated Wednesday. To be sure, Goldman's baseline assumptions for next year paint a rosy picture. In fact, they read like a best-case scenario more than a baseline. That's not to disparage, and it's certainly not to suggest that any one of their assumptions is far-fetched. In fact, all of their assumptions seem eminently likely to play out. I would just caution that even if a set of assumptions is comprised entirely of projections that appear probable, they often do not all pan out at once, or at least not according to
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13 comments on “Goldman Sees ‘Roaring ‘20s Redux.’ S&P To Hit 4,600 In 2022

  1. Alex says:

    Praise Jesus! Goldman has shown us the light!

  2. libero says:

    All looks good but …….what about Trump?

  3. John3D says:

    Goldman’s prediction sounds just great for the top 20% (or 15 or 25). What about everyone else. How long can the top 20 feed off the bottom 80. Where’s the living wage, universal healthcare and affordable college education to name just a few things that would help the bottom 80%. At this point the unequal distribution of wealth seems unsustainable for much longer. I’m not a great student of history, but doesn’t this always end in violence and destruction of wealth. Care of the golden goose has been neglected for far too long.

    • runamok says:

      Yes. It does feel like something could snap, doesn’t it?

      The elite do not voluntarily give up their favor. Never. They fail to change and adapt. So, yes, these things usually do end up in volence and destruction of wealth.

      A strategy that buys them time is incremental reform. The elite in the US have failed even to make this accommodation.

  4. runamok says:

    We can always count on Goldman to keep “investors” (whatever that means) all lathered up.

    The German-hosted development of the miracle, Pfizer vaccine, though the beginning of the end for COVID, is still several months away from availability to the 800M people of Europe and North America. Estimates vary, but maybe next July is a tad early still for any of us readers to be getting the shots. I hope I’m wrong and we can get the shots by April. I’m dying to go to a bar again.

    Last I checked, about three minutes ago, the plaque was still rampaging across the US. Millions are still poor, hungry, homeless, or unemployed, as a result of COVID. These people aren’t going to be contributing too much to the $175, unless one counts the sale of tents.

    And, we have a government that might as well be that of a foreign adversary, hostile to our nation’s aims, like a departing colonial power, performing it’s last extraction of wealth from the land and people, before withdrawing.

    Would be nice to see a 10% correction here, flush out some of the early ticket holders.

    So, paint me “too early” to strap in on Goldman’s rocket ship.

  5. Red says:

    Wasn’t there a stat on this blog at one point that highlighted S&P earnings projections rarely ever play out?

  6. Ria says:

    Anybody out in Heisenberg land have insight as to why the dollar index is so strong today? Just looking for a post on what is going on….

    • BBG: “EUR/USD is down 0.5% at 1.1763 amid falling European bond yields, broadly lower option skews, and stops below the 55-DMA at 1.1782; fall is slowed by real money buying interest near 1.1750-1.1770, according traders in Europe
      GBP/USD is down 0.4% and near session low of 1.3220 with Brexit talks set to miss another deadline and roll into next week”

  7. Anaximander says:

    This Goldman (weren’t they about to go bust just 12 years ago after Lehman before the government, the public, saved their ass?) piece reads like a memo from la la land. Assumption number 4 is patently absurd. On what planet (la la) does the biggest recessionary shock in a lifetime in a recklessly over-leveraged system simply end after three months in a miraculous, ecstatic V? Why not also simply delineate a (counter factual) assumption that credit is expanding as opposed to collapsing. Where, exactly, will GDP recovery come from? Certainly not from consumers. The vaccine is a huge deal, but we were entering a global recession (depression) ‘before’ the pandemic, remember? Vaccines might just get us back to that baseline after a year and a half of economic destruction.

    • John3D says:

      Exactly what I was wondering, the part about ‘weren’t we ‘entering a global recession’? Seems to me measures like GDP and productivity were not trending in the right direction.

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