You may want to call him the Sigmund Freud of Wall Street.
Veteran strategist Edward Yardeni, who holds a Ph.D. in economics, says the stock market is suffering from an 'anxiety' disorder.
But investors may have just broken out of their recent funk, with stocks reaching new all-time highs on Friday — backing up his notion of a "'Seinfeld" market.'
"'Seinfeld' was a show about nothing to a large extent, and there was one episode where they made fun of the fact — basically admitting — that the show was about nothing in particular," said the Yardeni Research President recently on "Futures Now." "This market is running on 'nothing bad is happening.'"
He says there's not much to justify jitters about a near-term deep market pullback — citing strong earnings, the Trump administration's business-friendly policies and the economy.
Even jobs growth appears back on track.
Employers added 211,000 jobs last month, according to the Commerce Department. That's double March's number.
"Since the start of this bull market, it has been pretty easy to scare the living daylights out of people simply because 2008 was so dramatic," Yardeni said. "When you have a traumatic shock, you're prone to anxiety attacks on a recurring basis, and we've had lots of those. I've counted 57 anxiety attacks for the market ... in an outright correction of 10 percent or more."
His comments come as the S&P 500 saw its first record on Friday close since March 1. The Nasdaq remains on fire, registering its own fresh record close at 6,100, but it failed to hit an all-time intraday high.
"We are in the early stages of a melt-up. I think this is going to go higher, and I think this is being led by earnings," he said.
According to CNBC data, 75 percent of S&P 500 companies reporting earnings have beat on earnings per share in the first quarter. EPS is up nearly 16 percent versus the same time last year.
Yardeni is also banking on the idea the Trump administration will stick to its very pro-business and deregulation policies. Even though he believes tax cuts will become a reality, he doesn't believe a lack of tax cuts would trigger a correction.
"It's not like we desperately need tax cuts to make the U.S. economy work. It's working awfully well, with low unemployment, and earnings are at all-time record highs. What's wrong with that?" asked Yardeni.
But could an 'anxiety'-driven market cause a self-fulfilling prophecy? Yardeni says no.
"I can conclude that, especially with the way Congress worked out, that the markets are going to go higher," he said, predicting that the S&P will be in the 2,400-2,500 range in the second half of the year.
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