Leading indicators of an economic contraction, page-4

Just finished reading an editorial from Selector Funds Management which may prove of interest to you:

"A sharp decline in global stock markets in the final months of 2018 proved temporary, with investors enjoying a solid rebound during the first quarter of 2019. This dramatic turnaround illustrates the folly of those who aim to time markets. Determining whether we are late in the economic cycle, as some are apt to describe current conditions, or deciphering what our Reserve Bank Governor’s next move on interest rates will be, are fruitless exercises. Macroeconomic impacts are just that, they influence consumer behaviour and ultimately affect business outcomes. As it stands, the show stoppers include the ongoing trade wars between the U.S. and China and the future direction of U.S. interest rates. Domestically, the upcoming Federal election, alongside a slowdown in housing activity, is providing sufficient evidence that an economic slowdown is upon us. In the short term, these are all pain points for investors to endure and are equally hard to avoid. However, over the medium to long term, it is the businesses that have successfully adapted and reinvested in their respective operations, which ultimately thrive. In the most recent reporting season, which is always a great leveller, the evidence confirming a domestic slowdown was most evident. In contrast, the divergence in performance between offshore and onshore earners was just as glaringly obvious. To this end, the companies that make up our portfolio reveal a host of businesses with strong franchises growing offshore".