Over the past couple of weeks, everyone’s been wondering how long the stock market's “Trump bounce” will last. Several people have asked me whether a pullback is due and how bad it might be. Even as markets move higher, there is quite a bit of worry.

The stock market keeps hitting new highs. The Dow Jones Industrial Average crossed 19,000 for the first time last week, and the S&P 500 is up to 2,200, itself a record. In many ways, the market is off to the races.

Overall, last week’s data was quite positive. Existing home sales did very well, while there were signs that business investment is looking up. Although the news was not all good, most of it was.

With everyone out shopping today, we'll soon be seeing the usual slew of Black Friday data (and the instant economic analysis that goes along with it). 

The other day, we talked about the bond market and the effects of the recent sharp increase in interest rates. Although the immediate impact was real, we concluded that the adjustment was more a return to normal than something worse. In other words, nothing to worry about.

Last week’s economic data offered an encouraging picture of where the Trump era will be starting from.

I usually begin thinking about my economic forecast for the next year around the third quarter. At that point, the current year is largely on the books, and we know enough to start looking ahead a bit.

Since the election, much of the financial commentary has centered on the stock market's surprising surge. In fact, though, the largest changes by far have been in expectations for interest rates, which, in turn, have affected the bond markets.

Brad here. Back in August, Peter Essele, a lead portfolio manager at Commonwealth, wrote a very timely piece on the risks involved with low-volatility strategies. When we were talking the other day, he suggested writing a follow-up on that—and given what has happened since his original post, I agreed it was a great idea.

As I mentioned last week, Donald Trump’s administration could have a number of positive effects on the U.S. economy. With government spending growth set to ramp up—and taxes and regulations set to be cut—you can almost see a potential boom forming. It could be a good couple of years to come.