Don't bet against history! It's important to recognize that recent broad based equity market gains have been driven by a limited number of companies. It's what we call a narrow market rally. As a result, the Russell 1000 Growth Index is trading at a 25% premium to its 10-year average, where those valuations now look stretched. Market history shows that valuations eventually matter and once mean reversion kicks in, those market laggards can quickly become leaders. Rather than betting against history, we have been increasingly allocating to fundamental strength in the value style as well as dividend payers that have lagged this year’s market rally. All it takes is a little bit of patience to reap what history suggests will be excellent investment opportunities ahead.

Our work suggests that the U.S. is about to experience in increase in domestic industrial production that is set to last for years to come. The U.S. is poised for an industrial renaissance. While near-term economic challenges persist and may intensify over the coming months, long-term trends in labor force growth, economic freedom, and business investment remain exceedingly positive. Putting all this together leads us to believe that the U.S. is about to embark on a new era of economic growth driven by a growing and increasingly productive private sector.

Assessing the health and direction of an economy can be accomplished using economic indicators. These indicators fall into three main types: (1) leading indicators; (2) lagging indicators; and (3) coincident indicators. Each type plays a distinct role in forecasting economic trends and monitoring the current state of the economy. Explore the differences between these indicators and their significance.