Fisher Investments

Ken Fisher argues that the stock market is the best recession predictor, with a perfect record when hitting new highs, followed by yield curve shifts as the second-best indicator. He challenges Paul Samuelson's famous criticism about the stock market's predictive failures.

Q1 2026 earnings season continues with defense contractors reporting, while analysts expect 13% S&P 500 earnings growth. April flash PMIs will gauge economic impacts from Iran conflict, and consumer sentiment hit record lows despite stocks reaching all-time highs.

This weekly market review covers ongoing US-Iran tensions with naval blockades and cease-fires, Canada's Liberal Party gaining parliamentary majority in byelections, and UK GDP showing 0.5% growth in February despite previous economic concerns.

Ken Fisher explains that true diversification isn't simply spreading investments across many different assets, but rather combining investments with similar long-term return expectations that move in opposite directions short-term. The challenge is that major asset categories like stocks and gold have very different long-term returns, making proper diversification difficult.

One year after President Trump's tariff announcement, markets have largely recovered from initial shocks, with stocks rebounding despite ongoing legal challenges. The Supreme Court struck down reciprocal tariffs, but replacement tariffs face continued uncertainty over their scope and duration.

Ken Fisher explains that while many expect Europe to be most vulnerable to oil market disruptions due to import dependence, the countries actually most impacted are those with zero domestic oil production. Japan and South Korea, being 100% dependent on oil imports, have been hit harder than Europe or the US.

Ken Fisher addresses various financial questions, arguing that World War II didn't end the Great Depression but rather that wars create recessions through global trade disruption. He also discusses inflation expectations, bond roles, price-weighted indices, and REITs as investment vehicles.

This week's key market events include Q1 2026 earnings season with projected 13.2% S&P 500 earnings growth, China's GDP report expected to show continued but slowing growth, and IMF spring meetings with updated global economic outlook projections.

This week's review covers a conditional ceasefire between the US and Iran, US inflation rising to 3.3% in March, and reflects on one year since President Trump's Liberation Day tariff announcement. Markets continue to focus on long-term trends rather than short-term headline volatility.

The speaker explains that oil price increases alone don't cause inflation - only central banks creating new money faster than economic growth does. When oil prices rise, people reallocate spending from substitutable goods to essential items like fuel, rearranging rather than increasing overall GDP.

Ken Fisher explains how to distinguish between temporary market corrections and sustained bear markets, emphasizing that real bear markets typically start gradually and accelerate their decline in the final third of their duration.

Ken Fisher argues that contrary to popular belief, Europe hasn't been more vulnerable to oil market disruptions from the Iran war than the US, despite being more import-dependent. The countries most impacted are those with zero domestic oil production like Japan and South Korea.

Fisher Investments discusses three key economic data releases for the week: March U.S. inflation data, Fed meeting minutes, and consumer confidence data. The analysis emphasizes that while these metrics generate headlines, investors shouldn't overreact to single data points or try to predict Fed actions.

Q1 2026 saw sideways market movement with correction-level volatility driven by Middle East conflicts, government shutdown fears, and tariff concerns. Despite challenges, Q4 2025 earnings exceeded expectations marking potential sixth consecutive quarter of double-digit growth, while global elections in Denmark, Italy, and France created legislative gridlock that typically benefits equity markets.

Ken Fisher distinguishes between short-term corrections and sustained bear markets, explaining that while both involve significant declines, true bear markets that matter are longer-term events typically accompanied by recessions and driven by big scary stories that markets haven't yet recognized. He argues that short, sharp drops like COVID or 1987, while technically bear markets, are too fast to time successfully.

Ken Fisher argues there is no currency reset occurring with the US dollar, explaining that the current dollar decline mirrors the pattern from Trump's first presidency. He dismisses the idea that cryptocurrency movements indicate a monetary reset, noting that currencies naturally fluctuate over time.

Ken Fisher argues that fears about China dumping US Treasuries are overblown, comparing it to similar unfounded fears about Japan in the 1990s. He emphasizes that China only holds 2% of total US Treasuries, the same as Japan, making any potential sell-off a minor threat.

The March 2026 economic update covers three key areas: upcoming US jobs data following February's 92,000 job loss, eurozone inflation trends amid Middle East energy price spikes, and private credit market disruptions with fund withdrawal restrictions. The analysis emphasizes that backward-looking data shouldn't drive investment decisions while highlighting stocks as inflation hedges.

The analysis covers recent market volatility driven by Iran conflict developments, March PMI readings showing global economic resilience, and gold's counterintuitive 18% decline despite geopolitical uncertainty. The overarching message emphasizes market discipline and patience over emotional reactions to volatility.

Ken Fisher argues that fears about China dumping US Treasurys are overblown, noting that China only owns 2% of total US debt. He draws parallels to similar unfounded fears about Japan in the 1990s and explains that Treasury selling is typically just countries switching preferences between different sovereign debts.