On Friday I did a speech for the crane owners group and knew I had to make sure that all the bad, mad and dangerous short-term news circling right now didn’t cover up the positives out there waiting to happen. This came in a week when a worried friend admitted to withdrawing $20,000 and stashing it in her safe! And an academic I know really well revealed how concerned he is about our economic future.

His trouble is that he’s an expert in the history of the ancient world rather than the likely future of economies, stock markets, interest rates and house prices.

Admittedly, recounting and learning from the past is easier than forecasting/guessing our economic future, but let me share what my crystal ball is saying.

On Friday, Goldman Sachs in the US argued that many of the headwinds hitting stocks and the potential for economies are weakening.

Potential peace talks, a sensible sounding Fed boss, Jerome Powell on interest rate rises last week and the US stock market surging over 5% for the week are all signs that investing smarties aren’t as spooked as my cash stashing friend and my academic sidekick.

Talking to one of Australia’s biggest crane operators on Friday, I learnt he sees five to eight years of work ahead, with a lot of government-driven infrastructure spending, which is more reliable than private sector planned outlays. These can be derailed by recession and market crashes but infrastructure spending is actually ramped up in tough economic times as a possible panacea.

A surprising number I heard last week was that bookings for Qantas overseas travellers is running at 80%, while Jetstar is at 110%. These are signs that we want to get back to normal ASAP.

On the economic data front, the news is also very positive, as the following shows:

1. Employment rose by 77,400 in February with full-time jobs up by 121,900 but part-time jobs were down by 44,500. Total employment hit a record high of 13.37 million in February.

2. The unemployment rate fell from 4.2% in January to 4% in February – a 13½-year low

3. The National Australia Bank (NAB) business confidence index rose from 4.5 points in January to 12.7 points in February (long-run average: 5.3 points).

4. The NAB business conditions index rose from 1.9 points in January to 8.5 points in February (long-run average: 5.8 points). Employment conditions jumped 8.6 points (the most in 14 months) to 7.6 points.

And what about the plight of wage earners? Well, if the AFR is correct, happier pay rise days lie ahead for many Aussie workers.

David Marin-Guzman is tipping 5% wage hikes are coming down the road for thousands of workers. “About 30 blue-collar enterprise agreements approved in the past six months are underpinned by inflation guarantees,” he revealed. “Most of the pay deals will automatically pass on the CPI rate recorded for this June quarter, which is forecast to spike at 5 per cent or more due to rising commodity prices following Russia’s invasion of Ukraine.”

Lately, pay rises have been more around a 2.7% increase but negotiations between the transport union and the big transport companies show big pay hikes are coming.

Some enterprise agreements have a cap on them but others will be determined by what inflation does, and because the labour market is so tight with about 400,000 foreign workers still missing because of the pandemic, local workers are in for a good year for wage rises.

CPI-linked pay rises haven’t been seen since the 1980s, and while they can be great for making sure the purchasing power of a worker's wage is maintained, it can lead to a wage-price spiral, where employers increase the price of their products and services to offset pay rises.

The AFR says some firms will be giving wage rises up to 8% because of their CPI-linked pay promises.

That won’t last, as big pay demands will lead to employers looking overseas and to online for alternative worker solutions. Also, foreign workers will soon rejoin our labour force.

Most workers won’t see 8% increases but they will see much better rises than they have seen for a long time, with such a tight labour market. And it comes as we know RBA boss Dr Phil Lowe isn’t keen to increase interest rates too quickly.

It looks like a perfect ‘storm’ of positives and it’s why stock market heavyweights are very keen to buy shares right now, and they’re even buying tech stocks again!

Below is the five-day chart for Afterpay’s new owner Block (formerly known as Square), and its share price has spiked 40.6% in a week! If that’s not smoke about businesses, economies and stock prices set to be on fire in the coming months, I don’t know what is!

Block Inc

Sure, there are still curveballs out there like the new Coronavirus strain BA.2, and China’s city shutdown to deal with an outbreak of infections, which could hurt the supply chain and raise more inflation concerns. But right now, the positives are outweighing the negatives.

And if Vladimir Putin doesn’t overplay his upper hand, then I think stocks will go up in 2022 and 2023. I could be a little more negative about 2024, as higher interest rates, stronger pay rises and overvalued stocks could easily give way to a big sell-off.

But that’s then, this is now. And while I could look crazy on short-term shocks to stocks, in the longer term I reckon I’ll be on the money. And who our PM is after May won’t change my view.