A recent Barron’s article shares market insights gleaned from an interview with Harold “Jay” Bowen, who has overseen the Tampa Fire and Police Pension fund’s extraordinary performance since 2000.

Here are some highlights from Bowen’s comments:

• The lack of any market correction before early last month has been an anomaly. “The market is sniffing out a return of the business cycle, which was full of dust and cobwebs” says Bowen, adding, “A pullback wrings out some of the excesses. It allows stocks to regroup and forge ahead.”
• Going forward, Bowen says that earnings look strong. “It isn’t unrealistic to think that we could have a low-double digit increase in corporate profits this year for earnings per share of $148 to $152 for the S&P 500. Stocks will continue to be the asset class of choice.”
• Bowen describes monetary policy as the “800-pound gorilla for the market.” The new Fed, he says, “seems determined to end the negative real fed-funds rate regime” and will “focus more on market prices like commodities and the foreign-exchange value of the dollar to gauge its actions.” He believes that the Fed will allow the economy to grow at “above-trend” rates as long as these prices are signaling a pro-growth, non-inflationary environment.
• According to Bowen, opportunities exist in artificial intelligence, robotics, nanotechnology, Big Data, blockchain technology, biomedical engineering, 3-D printing, and industrial automation.” He says, “It is happening concurrently with tax and regulatory policy initiatives that should accelerate it.”