Summary: Despite a positive mood in the American market, some troubling conditions remain. I am worried that the market appears overvalued when analysed using the cyclically adjusted price-earnings ratio. Housing figures have been mixed, after I expected they would be consistently strong. The quality of earnings and the dysfunctional democracy in the US are also concerning, while geopolitical turbulence is becoming less important to markets.
Key take-out: I still believe the rest of this year will be good for the economy and the market, but some worrying factors could change this.
Key beneficiaries: General investors. Category: Economics and investment strategy.