I have been pretty open about my opinion on those who are only preparing for a recession and more extreme downside in the markets. The news sure is throwing the fear and uncertainty in our faces right now.

I do think it is a big mistake here to only have one directional bias. I think investing for all sides is an acceptable approach here (maybe scaling into positions while saving some cash on the sidelines as we go).

Here are my thoughts:

1st: There is a tug of war going on between higher interest rates and inflation on one side, and reopening's of entire economies around the world on the other side. International travel is happening again, this is good for U.S. businesses who have international exposure and for U.S. businesses who have international travelers come visit.

2nd: The consumer is generally in better shape with padded savings accounts (yes, still) and still more room to take on consumer debt to get to pre pandemic levels. Spending is still happening, but, it's shifting from goods to services or things that help people feel good for events (see $TGT vs. $ULTA earnings for example).

3rd: The stock market is not cheap here, but it's also not expensive (below the 5 year PE avg according to Factset). At the lows, the PE ratio got down below the 10 year avg. Even if earnings estimates are cut back, the market still could be considered not that expensive at current levels or at YTD lows. We have to see quarter by quarter how businesses are faring. The market could flutter until we know more. Some sector or industry earnings (energy, travel, financials), may make up for slowing growth in others (retailers, some tech).

So... There are alot of puts and takes here in my opinion, and I wouldn't be surprised to see the market selloff and growth estimates come in more, but, I also wouldn't be surprised to see earnings steady and for us to end up around current levels or even higher if things end up better than expected.

Either way, assuming only one direction from here can get you in trouble imo