Well, the stock market got over Brexit rather quickly. The market dropped hard for a couple of days , then it went back up to almost where it was before.

I think the stock market is defying gravity. GDP growth rate has been dropping for the past year, corporate profits are lower than they have been for years, a lot less jobs were created in May than previously thought, and corporate junk bond defaults are rising.  This doesn’t look like a scenario where the stock market should be near it’s top.

People are earning less than they used to and price to earnings ratio’s are much higher than they used to be. Now to be fair, lower interest rates cause people to invest in stocks and expect lower rates of return than they used to get.

Even though official unemployment rates are down, we have some of the lowest employment participation rates in 38 years. Does it look like someone may be cooking the books?

If you look at the real numbers, the economy is rather sluggish at a time when interest rates are almost zero. I suspect the Federal Reserve is getting backed into a corner real fast as they try to stimulate a declining economy.

The stock market may defy gravity for a while, but my money is on the power of gravity in the long run. I suspect we will see sluggish performance for a while, and then things could start to go downhill fairly rapidly.