The coronavirus pandemic saw a different picture in the past that left the economy fall to new levels. But now that the vaccinations are being administered across the globe, the economy is improving and even the earnings have started to rise. The stock market sold off just like it did on July 9, 2021 and now is the right time to buys the stocks that you have been looking for since a long time. But one has to realize that things are still in the pre-mature level and here are a few reasons why the bull market in stocks could last for the next 5 years.
1. The demand is high – People are looking for hints from the Federal Reserve about stimulus as they are looking for the private sector forces that will help to push the stocks higher. There is a prospective private sector demand that can help towards the growth of the GDP in the United States by 8 percent in 2021.
2. There could be unexpected earnings in future – The economy has recovered in very less time and the recovery has been unexpected that has been out of the predictions of the analysts. The future could also be different and there are chances of massive growth in future that should not be underestimated.
3. Inflation might not ineffective – Inflation is surely showing an upward growth. But there is also more theories like the population is ageing and older people tend to spend less. The improvement in businesses will help to improve productivity in the companies. This will in turn allow passing of the rising costs to the customers.
4. Values will improve – The current phase marks an economic rebound. For months, the stocks trade sideways and that happens mostly due to the fear of inflation. Overall, the economy and earnings will continue to increase. This also helps to reset the stock valuation lower and removes the chief concerns among the investors – which is high valuations.
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