With so many forces at work in the markets and the global economy, there is a lot of uncertainty simmering on many levels. In a Barron’s article from earlier this month, Blackstone strategist Byron Wien offers some insight on the causes and potential outcomes:

• Corporate operating margins have been compressed due to limited volume growth and rising wages. Wien expects this to continue into next year.
• He doesn’t see a severe sell-off or bear market in the offing. “The yield curve is not inverted and investor sentiment is cautious rather than euphoric, so we have yet to see two conditions that are ordinarily in place just before a bear market begins,” Wien says.
• “One factor that should encourage investors is the leading indicator index” which, he says, is still edging higher but has not yet peaked. “When it does,” he asserts, “we will still have some time before the next recession and perhaps the next bear market.”
• Wien says, “I still believe the U.S. economy will grow about 2% for 2016, which has been my forecast since the beginning of the year.”
• He believes the Fed will “stay on hold” until December, when it may raise rates modestly. “We should not count on any significant monetary accommodation to lift stock prices.”
• The implications of the Brexit vote, according to Wien, “could be significant for the U.K. and Europe but minor for the U.S. In any case, however, the impact should not be immediate.”
• As far as the upcoming election is concerned, Wien believes that “the electorate cares most of all about the economy and is likely to support the candidate who is most likely to stimulate growth and job creation.”