Usain Bolt holds the world record, set in 2009, for the fastest 100 meter race in history at 9.58 seconds (he ran a wind aided race of 8.97 seconds once!). Bolt’s record breaking race was run in ideal conditions on a perfect track. The 110 meter hurdle world record is 12.80 seconds (adjusted for 100 meters the time would be 11.64 seconds). That’s almost 20% slower than the 100 meter dash. Why? Simple. There are ten 42 inch hurdles to jump over on your way to the finish line! It’s a lot harder, in fact impossible, for the same runner to go faster over the hurdles than the dash.
This is one lens to view the economy and the stock market as we move forward. We have hurdles. Primarily higher interest rates. All things being equal, higher interest rates will increase company costs and weaken demand as consumers are challenged by higher financing costs.
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