The current US economic expansion has now reached 121 consecutive months - which is officially the longest on record. The expansion, which began in July 2009 on the recovery from the depths of the Global Financial Crisis, has overtaken the strong period of GDP growth between 1991 and 2001.
Can the US expansion and the subsequent market rise continue, or is the US economy set to roll over? Below, five investors discuss the prospects for the world's largest economy.
Charles Kantor, portfolio manager of the Neuberger Berman US Long Short Equity Fund
Despite market gyrations due to uncertainty over trade policies, the future path of interest rates and global growth concerns, the US economic backdrop remains positive, notwithstanding a modest deceleration in the second half of 2019.
US macroeconomic data, while decelerating, has remained supportive of growth - reflected by manufacturing output, capacity utilisation and healthy home and auto sales. Meanwhile, recent fiscal policy and ongoing de-regulation and lower corporate tax rates has raised growth rates above trend levels.
The next phase of growth is likely to be dictated by how effectively corporate management teams allocate newfound cash flows - creating opportunities both long and short. We remain mindful that our constructive view on risk assets is not without challenges as we embark on over a decade of economic expansion. Despite positive US and economic data, China and eurozone economies remain fragile. Additionally, the current Federal Reserve policy presents the potential for spikes in volatility.
Given the vicissitudes of an increasingly global economy, we will remain flexible in our decisions and open-minded to new ideas across different sectors, asset classes and geographies.
Adrien Pichoud, chief economist and head of multi-asset at SYZ Asset Management
Real-time indicators of GDP growth point to softer US expansion. Although external factors such as tariffs and trade uncertainties have had a negative impact, they are not the only ones to blame.
Domestic fiscal policy is having an adverse impact on growth, or more precisely, a less positive impact compared with last year. The impetus provided by Trump's 'Tax Cuts and Jobs Act' boosted GDP growth last year by about 0.7%, 0.4% this year, and, if no new legislation is enacted, it may become a negative contributor to GDP growth in 2020.
In the industrial sector, new export orders stopped growing, capex has slowed, and job creation has basically ceased. For the moment, this soft patch appears to be contained within the industrial sector. However, the longer this industrial 'air pocket' lasts, the more it risks impacting the entire US economy, particularly if it affects business and household confidence.
The US economy was bound to slow down this year, and it can hardly accelerate without another round of fiscal stimulus and a widening public deficit.
Larry Lau, manager of the Trium Diversified Macro Fund
The single biggest catalyst for the sustained recovery of the US was the introduction of extraordinary monetary easing. Post-GFC, the US became a key growth engine of the world and asset prices expanded alongside.
However, the arrival of President Donald Trump with his protectionist instincts complicated long-term prospects for the US economy. Fiscal policies intended to encourage corporate America to repatriate business activities eventually saddled the country with a mountain of debt. An ongoing dispute over foreign trade breeds concerns for the future of global trade and in the near term elevates costs for local businesses.
Riding the bond buying spree of central banks has been a mainstay macro trade over large parts of the past decade. The QE taper and the recent hiking cycle were diversions that warranted investment care. However, some might see hints of moderation in growth and a dovish shift at the Fed as signs of near-term support for bonds.
Equity markets have weaved their way towards record highs, emboldened in part by a belief of an eventual resolution to trade spats. Yet, uncertainty over economic prospects in the US and globally has grown sufficiently to alert policy makers - keeping investors on their toes.
Benjamin Morton, EVP, head of global infrastructure at Cohen & Steers
The US economy is now in its longest expansion in modern history, supported by stimulative monetary policies in the wake of the financial crisis. We believe the economy will remain on a growth track through 2020 at least, especially given the Fed seems willing to reduce interest rates again if growth slows too much.
Despite the prospect of slowing global economic growth over the next year, we believe infrastructure companies will generally be able to maintain solid revenue growth amid favourable supply-demand trends for many subsectors. In this environment of moderating growth, and given pockets of political risk, we have positioned the portfolio more defensively on the margin.
At the same time, we continue to favour companies which stand to benefit from strong secular trends, such as cell tower owners. Rapid data growth in the 4G and 5G eras will require massive investments by wireless carriers - tower tenants - over the next decade.