In school, I did not get very deep into differential calculus before the math was over my head and my mind drifted to other subjects, particularly economics. Therefore, it wasn’t surprising that I never noticed the difference in the way mathematicians use the term inflection point, and the way market strategists use it. An inflection point for stock jockeys and market watchers is when a stock or the market stops going up and starts going down or vice versa. For stocks, the most recent one of these would be March 9, 2009, when the S&P 500 bottomed at 666. It is now 2,100. Picking the next inflection point is thought by most to be impossible. When will the market peak? I am not at all sure. But what about the mathematical definition of inflection point? That is an entirely different place: a point between the top and the bottom of a curve at which the rise or the fall slows and begins the process of making a top or a bottom. If you think about a radio wave on an oscilloscope, the inflection point would be halfway up from the bottom. Predicting when one of these will occur in the future may be as hard as predicting a peak or a trough. But pointing out one in the past seems much easier. I think 2014 was likely the inflection point for stocks in this cycle. Therefore, 2014 would mark the beginning of the end of this bull market. 2014 had many characteristics which point to it being the inflection point. Corporate earnings were growing at the fastest pace in the cycle up until the fourth quarter, when they slowed dramatically. Stock prices increased at 32 percent in 2013 but only 12 percent in 2014. And, so far in 2015, only about 2 percent. Productivity increases have stopped being positive and turned negative, which can’t help corporate profits in the future. The Federal Reserve quit QE and therefore ended the most aggressively accommodative period in our history. The dollar has risen so much that imports are 20 percent cheaper compared to domestically produced goods and our exports are 20 percent more expensive for anyone overseas looking to buy them. And, lastly, worker wages seem to have finally turned up as businesses have hired all the cheap labor they can find. This will put further pressure on profits. The rate of growth of corporate earnings, I believe has slowed. In turn this is slowing the rate of growth of stock prices and eventually we will have reached a peak. Brian B. Sullivan, CFA President & Chief Investment Officer, Regions Investment Management (c) Regions Bank, Member FDIC. The foregoing represents the opinions of the author, Brian Sullivan, and not necessarily those of Regions Bank or Regions Investment Management, Inc. (RIM). RIM provides commentary to clients of Regions Bank, an affiliated company wholly owned by Regions Financial Corporation. 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