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Market Update

How to Invest Late in the Economic Cycle

Contributor John Waggoner explores where we are in the economic cycle and what sectors may be poised to profit.

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Every so often, you notice some things are starting to show their age. Your lawn mower now requires Herculean effort to start. Your wife gently suggests you get a sports coat made in this century. You realize your air conditioner was made in the Bush administration. The first Bush administration.

On Aug. 22, you'll hear that the current bull market--should it still be in place--is the oldest bull market since World War II. By that time, too, the current economic recovery, which began in July 2009, will be 74 months old, the third-longest since 1857 and twice the length of the average economic expansion. All of this begs two questions: Are we in the late stages of an expansion, and if so, what are the best investments for it?

John Waggoner does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.