Ken Fisher Provides His 2021 Mid-Year Stock Market Report

Title screen appears, “Ken Fisher Provides His 2021 Mid-Year Stock Market Report.”

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A man appears on the screen wearing a light blue shirt and tie, sitting next to a fireplace.

He begins to speak.

A banner identifies him as Ken Fisher, Executive Chairman and Co-Chief Investment Officer, Fisher Investments.

Ken Fisher doing hand gestures time to time explaining.

Ken Fisher: As I speak to you in July of 2021, we've come through a 17-month period that's, for obvious reasons, been very extraordinary. With so many different extraordinary things, a lot of which I've talked to you about as they've evolved, including the lockdown restrictions that shut down the economy, the very fast V shaped bounce back that came from that and the degree to which the bear market acted like an oversized correction rather than a classic, slow grinding bear market accompanied by a traditional recession.

Ken Fisher: This was not a recession that we had in 2020. It was a constriction caused by the lockdowns. And therefore, the bounce back was not the kind of bounce back that you normally get after an economic recession that has to correct for prior excesses and dislocations in the economy, but instead simply about unwinding the lockdowns. The fact of all of this, as we look at the last six months, the beginning of 2021, is that it's acted a lot like things that we might have expected, with a lot of what I view as nouns and adjectives that confuse people.

Ken Fisher: We have bounced back to levels where the US economy is where we were before all this stuff started. We've had very fast growth to do that because of that rapid bounce back, unlike what you get normally after a recession. We now are moving into a period that people project that into the future, thinking that, boy, oh boy, we're off to the races, because they think it's a new cycle. But it's not really a new cycle. It's really just a return to the old cycle that was here before we were briefly interrupted in it by the COVID lockdowns.

Ken Fisher: The feature of all of this is that 2021 has behaved a lot like you might have expected it to when you look at things like stock market returns have been very typical for the first year of a new Democratic president, which, other than with Jimmy Carter since World War II, have always been double digit. The fears that the Biden administration Democratic Congress would be able to do all these sweeping things that the Biden administration initially talked about have largely been non-existent.

Ken Fisher: Steadily throughout the course of this year, they've been unable to get through Congress the big, sweeping things that were initially talked about. And that continues and will continue all the way through the 2022 midterm elections. But that's normal. It's this feature of having a form of invisible gridlock that I've talked to you about in prior videos where the Democratic Party has control of Congress, but they can't really get anything through Congress, not anything other than that which gets broad agreement, of which there's very little.

Ken Fisher: The business environment still has pockets of things that have been negatively impacted by COVID that probably will never come back, or they won't come back for years and years and years, but their aggregate effect on the economy is small.

Ken Fisher: This would be things like major urban downtown, single location restaurants which are suffering still very badly, a lot of other downtown small retail suffering badly. But otherwise for the most part, the economy is not only fully recovered but it's acting fairly robustly and is a return to the trend line that existed before COVID struck in the first place. That feature that it's a continuation of what was going on before is the hardest thing for most people to get through their brains. To actually accept because the COVID period was so exceptional that they're keeping and continuing to look for the exceptional rather than to look for that we have actually come to a return to where we were before.  And we're moving on as if we had a world that had just continued with the growth trend that we were in before COVID struck.

Ken Fisher: So, what I say to you is that the last six months has been basically a relative return to normalcy. Little less so outside of America, but more so outside of America than you would believe by reading Media. Recovery is more in place, more intact and continues now to act in a fairly low growth mode that is consistent with what would be an extension of what went on before COVID ever struck in the first place.

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A series of disclosures appears on screen: “Investing is Securities involves a risk of loss. Past performance is never a guarantee of future returns. Investing in foreign stock markets involves additional risks, such as the risk of currency fluctuations. The foregoing constitutes the general views of Fisher Investments and should not be regarded as personalized investment advice or a reflection of the performance of fisher investment or its clients. Nothing herein is intended to be a recommendation or a forecast of market conditions. Rather it is intended to illustrate a point. Current and future markets may differ significantly from those illustrated here. Not all past forecasts were, nor future forecasts may be, as accurate as those predicted herein.

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