MIDYEAR OUTLOOK 2021
Picking Up Speed
In the first half of 2021, the U.S. economy powered forward faster than nearly anyone had expected. As we were writing our Outlook for 2021 in late 2020, our economic views were significantly more optimistic than consensus forecasts — but in retrospect, not nearly optimistic enough. Our theme was getting back on the road again and powering forward. But as the economy accelerates to what may be its best year of growth in decades, power has been converted to speed, and we’re trading highways for raceways. Speed can be exhilarating, but it can also be dangerous. The overall economic picture remains sound, likely supporting strong profit growth and potential stock market gains. But the pace of reopening also creates new hazards: Supply chains are stressed, some labor shortages have emerged, inflation is heating up — at least temporarily — and asset prices look expensive compared to history. Markets are always forward looking, and in LPL Research’s Midyear Outlook 2021: Picking Up Speed, we help you keep your eyes on the road ahead. The next stretch may be a fast one and will have its share of opportunities, but also new risks to navigate. As always, sound financial advice can be as important as ever to help steer you through the environment and put in the miles toward meeting your long-term financial goals.