Robert Gay

Sales growth is high and profit margins are up, indicating that overall corporate wealth continues to accelerate.

Long treasury bonds in particular are lauded for their security. Although there is no risk to the coupon, higher inflation is a significant risk to long term purchasing power and higher interest rates are a short tern risk to capital.

The Earnings Surprise Model is designed to exploit the performance benefit of investing in leveraged and accelerating companies.

Third quarter financial statements suggest that the recovery leadership is shifting from consumer durables spending to capital goods spending.

With corporate earnings growth heating up and demand for capital rising, shares of companies with low and stable growth rates will likely perform poorly.

For now, we are in the acceleration stage of the corporate growth cycle.

Despite all the concern about macro-economic weakness, companies continue to accelerate.

Too often, investors are spooked by a market drop and make the mistake of selling weak shares.

Bob Gay is founder of Global Equity Analytics and Research Services [GEARS]. He manages 4 investment models on Covestor.