Tom Lee, the head of research at Fundstrat, said that the ongoing war and increased defense spending are playing a significant role in the economy’s resilience and the continued rise of stocks.
Speaking to CNBC host Brian Sullivan at the show ‘Power Lunch’ on Monday, Lee stated that the war is “actually quite stimulative to the economy.”
He explained that, though it “sounds counterintuitive,” the increase in defense spending, potentially reaching $60 billion a month, is helping to offset the impact of rising oil prices, which are adding approximately $12 billion a month to household expenses.
‘War Is Actually Helping…’
“The war is actually helping earnings right now,” said Lee.
He acknowledged the burden of increased gasoline prices on families, especially amid ongoing inflation. However, he suggested that the additional costs, estimated at $50 to $100 per family per month, are not sufficient to damage the economy or corporate earnings.
When asked about the factors influencing the stock market, Lee identified the war as the most significant, capable of creating “tail events on both sides.” He downplayed the impact of …
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