Despite a recent report of a slowing national economy, two national investment experts said Thursday in Billings that they still see signs of improving markets and consumer demand.
“Confidence is actually coming back across the country, and that’s a really good sign,” said Kate Warne, Edward Jones’ chief investment strategist based in St. Louis, Mo.
Warne was the keynote speaker during a financial education banquet for investors at the Billings Hotel and Convention Center. Warne, 58, who has a doctorate degree in economics from Yale, has made appearances on CNBC, CNN and in the Wall Street Journal as an expert in financial matters.
At the Billings luncheon, she was joined by Steven Olson, managing director of J.P. Morgan Asset Management. About 200 people attended the 90-minute presentation.
The talks came on the heels of sobering news Thursday that the U.S. economy contracted for the first time in three years during the first quarter of 2014. Largely because of a brutal winter that chilled sales, the U.S. Department of Commerce revised estimates to show a decline of an annual rate of 1 percent of the nation’s gross domestic product.
However, Olson said other national economic indicators look more positive. Home sales are picking up. Unemployment rates are falling. Consumers are hitting stores and buying goods again.
“The world is not ending. You don’t need to get your beans and your bullets and head to your bunker,” said Olson, who lives in New York City.
At the same time, investors struggle with what to do with their money. Interest rates remain low, and the returns on low-risk bonds and CDs have been soft, Warne said.
Warne’s suggestion? Classic, reliable diversification, with investments divided among bonds and a mix of stocks in U.S. and international markets, because rates will likely stay low well into next year, she said.
“A lot of people are feeling better, but they aren’t sure what to do about it,” Warne said.
A former energy trader, Warne said she expects oil and gas stock to remain steady but grow little. Supply is booming, largely because of the Bakken oil fields, but gaps in the transportation infrastructure slow movement to the market, she said.
“We’re going to see demand grow, but we’re also seeing supply come in to meet the demand,” she said.
Warne said she gives similar talks across the country a few times a month. She always asks people to raise their hands if they feel confident about the direction of the economy, and she said she’s seen improvements in her anecdotal survey.
“I’m getting more people willing to raise their hands than I did a year ago,” she said