Just study today's winning sectors/industries (table below). Don't you just see the "capex" signature all over it?

Still, I'm not convinced the broad equity market rally can be sustained into 2007. I believe markets discount economic data by up to 9 months, and that 2006 will be the top.

I still believe that Dow=9800 (maybe 9200) will be the 2006-07 low, and that rising interest rates will be the problem that forces a curtailment in global economic growth. But the Dow may pop to 12000 or higher in the interim depending on how much money printing goes on.

As long as there is a trade war building, interest rates in many countries are being kept at unreasonably low levels. That's ok as long as there are buyers for a nation's bonds. When that source dries up, rates go up.

I do agree with Elaine Garzarelli that capex will be funded off existing balance sheets, which are as strong as I have ever seen them. That's helping the bond market, and will continue to do so.

But trade wars and rising interest rates don't lead to higher unit sales volumes or pricing power, which doesn't show me "the best profits picture I have seen in my career" as per Garzarelli.