Is the U.S. Economy Peaking and Heading for a Fall?

Domestic growth has been strong all year, but it seems like the rest of the world is slowing down.

November 9, 2018 3 min read

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The market giveth and the market taketh away.

A day after posting the biggest gain on the Entrepreneur Index™, TripAdvisor Inc. was down 5.42 percent today. The online travel website posted strong earnings yesterday and saw a 16 percent jump in its stock.

TripAdvisor wasn’t the only stock giving back gains. Ralph Lauren Corp. up 3.78 percent yesterday, fell 6.26 percent today, the biggest decline on the Entrepreneur Index™.

The market as a whole was down, with the Entrepreneur Index™ falling 1.2 percent. While a late afternoon rally pared losses, share price declines on the index outpaced gains by a margin of 41 to 19.

The stock market had one of its best days of the year on Wednesday following the mid-term elections, but has been skittish for the last two trading sessions. Conflicting economic indicators may be the reason. On the one hand, the U.S. economy remains strong and a 0.6 percent jump in the producer price index (PPI) reported today suggests that the Fed will keep to its plans to raise rates again in December and next year.

On the other hand, the rest of the world — particularly China, the second largest global economy — is clearly slowing down. The price of oil, one of the better barometers of global growth, had its tenth straight daily decline today and is down more than 20 percent in the last month. Is the U.S. economy peaking and headed for a fall?

The bond market appeared to think so today. Despite the higher than expected PPI reading this morning, the 10-year Treasury bond yield was down 4.5

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