New Charles Schwab Investing Whitepaper: U.S. Growth Renaissance Presents
For Investors Who Missed Stock Market Rebound, it Might Not be Too Late
SAN FRANCISCO -- September 19, 2013
For investors who missed out on the rebound in equities following the
financial crisis in 2008 or for those who are underinvested in U.S. stocks,
opportunities may still exist according to a new whitepaper published by
Charles Schwab this week. The whitepaper, entitled “Take Part in a Renaissance
of U.S. Growth,” examines a domestic industrial renaissance that has begun to
unfold due to a host of factors including improvements in U.S. manufacturing
growth and competitiveness, a domestic energy boom, the likely end of a
commodity “supercycle” and low inflation.
The whitepaper is published as a Q&A with three experts from the Schwab Center
for Financial Research – Chief Investment Strategist Liz Ann Sonders, Managing
Director of Market and Sector Analysis Brad Sorensen and Director of
International Research Michelle Gibley. Schwab Center for Financial Research
is the think-tankin Schwab’s broker/dealer that provides investors and
independent advisors with Schwab’s point of view on a wide range of investing
and financial planning strategies.
Key points in the new whitepaper include:
*An industrial renaissance in the United States has begun to unfold due to
a host of factors, including a changing cost equation relative to China,
as well as a boom in the supply of energy at a low relative cost.
*A surge in U.S. energy production is being driven by a fracking and shale
boom that helps drive energy prices down and increases jobs and investment
here at home. Downward pressure on energy prices also makes it cheaper for
manufacturers to return business to the U.S.
*The industrial and energy renaissances should ultimately benefit the U.S.
economy in multiple ways; including keeping inflation modest, boosting
capital and infrastructure spending, improving job growth, lowering the
trade deficit via increased exports, and improving national security.
*The beneficiaries of the industrial and energy renaissance are likely to
include consumer discretionary stocks due to lower commodity prices (aided
by the stronger U.S. dollar), industrials stocks due to an expected
rebound in capital spending, and small capitalization stocks due to their
higher domestic exposure.
According to Sonders, Sorensen and Gibley: “We sensed that many investors have
written off the U.S. consumer as dead and are questioning the sustainability
of the U.S. bull market in stocks. But in our view, there is a positive story
about the trajectory for the country’s economy, based in part on the
likelihood that the United States becomes a global economic powerhouse again
in terms of manufacturing and exports.”
The full white paper, part of Schwab’s Investing Ideas series, is available
Schwab Investing Ideas offer analyses of key market trends and investing
opportunities investors can act on now from theSchwab Center for Financial
Research.More information, including other recently published insights, can
be found on Schwab’s Investing Ideas page.
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Michael Cianfrocca, 415-667-0344
Kate Clark, 212-704-4491
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