Bubble risk may be lurking for the US stock market, but the analysis could be wrong if economic growth accelerates in a meaningful degree due to the Trump administration’s planned policy changes. At this point, the case for anticipating a stronger economy is open for debate, but Mr. Market has already cast his ballot.

The S&P 500 rose to another record high yesterday and by some accounts, the best is yet to come. Stephen Suttmeier, a technical research analyst at Bank of America Merrill Lynch, thinks that the S&P is in a broad upswing that will continue to lift prices for several years. “The secular bull market roadmap says that the best days are ahead,” Suttmeier advised on Monday in a note to clients. “We believe that 2017 is the year of acceptance for the secular bull trend that began on the April 2013 upside breakout.”

Bullish momentum certainly looks encouraging these days and for the moment it’s reasonable to assume that the general tide for equities will continue to rise. What’s the fuel for the rally? In a word, Trump.

It appears that the market is encouraged at the prospect that the new administration’s plans to cut taxes, renegotiate trade deals, reduce regulations, and launch new infrastructure projects — changes that are expected to lay the foundation for a firmer macro trend in the years ahead.

The point man for optimism in the private sector is arguably Joseph LaVorgna, chief US economist for Deutsche Bank Securities. Writing earlier this week, he asserted that cutting taxes is “the perfect remedy for what ails the US economy.” Why? Because it will boost personal income growth, which is showing signs of losing momentum — “its growth rate is now expanding at the bottom end of its 3.5-to-5.5% band.”

On the surface, [the slow pace of consumer spending] is surprising given the fact the unemployment rate is below 5 percent. Normally, at this point in the business cycle, wages would be accelerating much faster than they are at present…. This is not happening, however; at least not yet. Amazingly, there is still little evidence of meaningful upward wage pressures.

The solution, he argues, is clear. “Lower taxes on labor will immediately lift after-tax disposable income. The upshot of greater after-tax disposable income would be faster consumption.”

This, in turn, will cause firms to meet increased demand by hiring more workers and extending the hours worked of their existing employees. Then, as the unemployment rate falls further, workers’ wages should rise because firms will have to bid up increasingly scarce labor resources.

The stock market apparently buys into this outlook, but some dismal scientists remain skeptical. Jan Hatzius, chief economist at Goldman Sachs, for example, sees trouble brewing, Bloomberg reports, in part because the Trump administration seems willing to risk a trade war. “Our simulations suggest that Mr. Trump’s policies could boost growth slightly in 2017 and 2018, but are likely to weigh on growth thereafter if trade and immigration restrictions are enacted,” wrote Hatzius and economist Jari Stehn earlier this week.

As a side note, the Bloomberg article that cites the report adds that “the investment bank’s increasing pessimism is striking considering the plethora of Goldman alumni in the president’s inner circle, including Treasury Secretary nominee Steven Mnuchin, National Economic Council Chief Gary Cohn and Dina Powell, who is working on economic growth issues and empowering women.”

So, who’s right? No one knows at this point. Perhaps both are wrong and the moderate US growth that prevailed prior to Trump’s election will continue. The stock market, however, begs to differ, and there’s no sign that the upside momentum is about to fade.

It doesn’t hurt that the US growth in this year’s first quarter is expected to strengthen. Although this has nothing to do with Trump’s policies, which are still in the development stage, there’s a whiff of recovery in the air, according to the latest Q1 GDP estimates from two Federal Reserve banks. The New York Fed’s analysis is especially upbeat, reporting that its model expects output to reach 3.1% (as of Feb. 10), a solid improvement over the 1.9% rise in 2016’s Q4.

The burning issue for investors is deciding if they buy into the forecast from some economists that GDP growth is due to rise further, once the Trump policy changes take effect. Mr. Market has already placed his bet. It’s largely speculative at this point, which is no surprise—the stock market is forever putting a price on an uncertain future. Sometimes the crowd is right, but not always. Par for the course.

The good news is that investors can modify Mr. Market’s forecast to match their views through asset allocation generally and adjusting the US equity weight specifically. But there’s a risk here too. Diversifying across asset classes is a poor strategy… if the future can be known with a high degree of certainty.