US Economic Expansion Will Be the Longest in History, Bob Doll Says

Nuveen’s veteran stock strategist thinks it will surpass the 1990s’ record by summer.

Never fear, says Bob Doll, amid widespread worries of an imminent recession either this year or next, with the resulting stock market bloodbath. The US economic expansion will continue, making it the longest in history, the longtime stock strategist contends.

Doll, the chief equity analyst at Nuveen Asset Management, issues his prognostications at the start of every year. They often are upbeat, but he has a pretty decent track record over time. His principal call for 2019 is for the expansion to be around 2%, down from the 3.5% annualized pace through last year’s third quarter.

“The U.S. is currently in the midst of the slowest expansion in modern history,” he wrote. And as a result, he reasoned, the domestic economy has been able to churn along without serious interruption since the recovery began in mid-2009. The reigning champion is the 1990s expansion, which lasted 120 months. Right now, we’re at 114..

Doll, who held the same job at Merrill Lynch and BlackRock, also believes that unemployment (now 3.9%) may beat the all-time record of 3.4%, set in 1968. He thinks wage increases will reach 4%. Average hourly earnings for 2018, according to the US Bureau of Labor Statistics, were up 3.2%.

As for the stock market, Doll forecasts the S&P 500 to finish this year at 2650. If so, that would be a modest advance of 5.7%. Right now, after the nastiness of late-2018 (down 4.4%), the index is up 3.6%, implying that there’s not much growth coming over the next 12 months. The path ahead, he wrote, will be “choppy and frustrating.”

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