The Fed has done an about face in the last few months, not only cutting 50bps – with more to come, stopping Quantitative Tightening – but now, increasing the balance sheet by ~$200B in the past 35 days (to stabilize the overnight rate).Your Rich Uncle is back and he’s bearing gifts! Don’t fight the Fed:

When you couple this with forward 2020 earnings estimates of low double digits in the US and sentiment/positioning at washout levels – you have the formula for multiple expansion moving forward (see 2 recent articles below):

Earnings Estimates Update: Johnny Nash Style…

AAII Sentiment Survey: Hurts So Good…

Impeachment noise, China Talks, and Brexit will simply be more bricks in the “Wall of Worry” we can climb to new highs into year end. The bar is set lower than ever for Q3 earnings – so expect a healthy beat rate. The key will be forward guidance and there’s a lot that any constructive movement in China talks can do to improve outlook in a short period of time.

And if that’s not enough, your rich Uncle has opened up the vaults committing up to $75B per day until Nov 4 (Reuters). Don’t bring a knife to a gunfight.  Your Uncle Powell happens to be the richest guy in the world and will add as much liquidity as needed in coming weeks and months.