Welcome to Thoughts on the Market.

I'm Andrew Sheetz, Chief Cross-Asset Strategist for Morgan Stanley.

Along with my colleagues bringing you a variety of perspectives, I'll be talking about trends

across the global investment landscape and how we put those ideas together.

It's Thursday, June 17th at 2 p.m. in London.

A question I get quite a bit is what's the best historical reference for current conditions?

There are a lot of views on this at the moment.

A strong post-pandemic recovery brings to mind the roaring 1920s, aggressive government support,

the new deal in the 1930s, low interest rates, high savings, and high government debt,

the 1950s, rising inflation, the 1970s, and buoyant stock markets driven by an active retail

investor, the late 1990s.

All of these are worth exploring, and indeed if events allow, we'll try to do so on future

episodes.

But for now, I wanted to point out similarities with one specific, much more recent

period for markets, the first half of 2004.

Similar to today, early 2004 followed in the wake of a large rally in equity and credit

markets.

That rally was led by cyclical inflation-sensitive assets, as confidence in the economy grew.

At 2004 dawn, with market levels that, if they weren't exactly the same as today, also

weren't a million miles away.

Levels for U.S. unemployment, expected volatility, expected inflation and credit spreads were almost

identical to the present.

...