Why This Market Will Keep Climbing

Labor Market Conditions - The unemployment rate remained stable at 4.34% in September, just 0.01 percentage points shy of reaching 4.4%, the highest since October 2021 [3] - Planned layoffs in Q3 totaled 202,118, marking the highest quarterly total since 2020, with year-to-date job cuts reaching 946,426, a 55% increase from the same period last year [3][4] - The current labor market is characterized by stagnation, cost increases, and transformative technology, with potential stabilization expected in Q4 due to anticipated rate cuts [4] Stock Market Valuations - The U.S. stock market is currently trading at its highest valuation in history, surpassing levels seen during the Dot Com Bubble and the Great Depression [5][8] - Despite high valuations, momentum is expected to drive markets higher over the next 12 months, particularly in AI infrastructure investments [10][24] Momentum vs. Valuation - In the short term, momentum is a stronger driver of stock prices than valuation, with evidence suggesting that momentum can overpower valuation in monthly or quarterly time frames [11][12] - Over a 10-year horizon, valuation becomes the dominant driver of market performance, but in the short term, investors are advised to focus on buying pressure and technical signals [17] Investment Opportunities - A significant financial event, referred to as Project Yorktown, is anticipated to redirect $4 trillion into specific market sectors, presenting a unique investment opportunity [27] - The activation of Project Yorktown on October 21 is expected to reshape America's financial landscape, with potential benefits for investors in overlooked market areas [26][27]