Challenge for investors to realise opportunities during the worst times

Despite frequent waves of negative news, there are several bullish trends emerging for the US economy and its stock market.

Housing affordability is at a record high, the Federal Reserve’s stimulus package is showing signs of traction and bank lending conditions are showing signs of improvement. Meanwhile, credit spreads appear to be normalising from the previous high levels, driven by investors’ ‘flight to safety’. As such, while we still need an economic recovery, it does not need to be a dramatic one. This is because at current levels, even a muted recovery would make things appear more attractive. In terms of equity markets, while US stocks may not be as cheap as they were in March this year following ...