But the show still goes on for the stock market. Yes, the market may be at a record high, but expect it to have plenty of awkward silences, bad jokes and jaw-dropping late guest appearances (aka corrections).
In honor of The Big Man, here’s CNNMoney’s Top 10 “The stocks could be hitting the fan this year” list.
10. China’s super slowdown
It’s no secret that China’s economy is slowing down. The unknown is how much more will it slide. China’s central bank is cutting interest rates to spur a snapback, but there’s little sign of a turnaround yet.
China’s economy grew by 7% in the first quarter of 2015, its slowest pace since 2009.
Related: Lucky fans say goodbye to David Letterman in person
9. Department of Correction
It’s like a bad joke where you don’t get the kicker. The stock market hasn’t had a correction — when it drops by 10% or more — since 2011. That’s historically a long time to go without one. Many experts believe a correction would actually be healthy for stocks.
But there’s no signs of it yet. In fact, the S&P 500 hit another all-time high this week.
8. The Greek drama has a bad ending
There’s still widespread concern that Greece could default on its debt this year. Greece has made progress recently, but it could still default in June, which could spark uncertainty — the key ingredient for volatility — in markets. Some economists believe there’s a 30% to 40% chance of Greece defaulting and leaving the Eurozone.
Related: David Letterman’s last show announced, clearing way for Colbert
7. The strong dollar knocks out earnings
The dollar has lost some of its momentum from earlier this year, but it’s still much more valuable than a year ago compared to most currencies. That’s a problem for America’s biggest companies and employers.
On Tuesday, Walmart (WMT) reported first quarter earnings that were hurt by the strong dollar. Walmart’s international sales dropped 6.6% from a year ago. Many other multinational companies, like Coca-Cola (COKE) and McDonalds (MCD), say the dollar is cutting into profits from their overseas businesses.
6. The Fed screws up
Investors across the world are waiting to see when the Federal Reserve will raise its key interest rate, which will affect millions of Americans and global markets. If the Fed acts too soon — a June rate hike is still possible — or too late, the markets could receive the news badly, triggering a stock sell off. Timing is key.
5. Will someone — anyone — grow their business?
Companies aren’t building up their business as much as they were a couple years ago. Capital expenditures measure how much a company spends on itself — whether renovating a new office or buying new equipment.
Capital expenditures have grown 2.4% in the first quarter of 2015. That’s better than a year ago, but way below the 26%, 19% and even 4.8% Cap Ex growth we saw, respectively, in 2011, 2012 and 2013, according to Lindsey Bell, senior analyst at S&P Capital IQ.
Related: David Letterman gets Bob Dylan for next-to-last show
4. The P/E problem
American stocks are pricey. One key yardstick to understand stocks’ value is the Shiller P/E index. It’s currently at 27.1, its highest point since 2007, right before the financial crisis. The index doesn’t suggest history will repeat itself, but it raises concerns about how much more room the bull market has to run.
3. Oil, oil every where…
Oil has bounced back after hitting its low of $43 a barrel in March, now up to $58. However, it’s still way down from $100 a barrel last August. That’s hurt most energy companies and put pressure on many energy-dependent economies like Russia and Saudi Arabia. The world just has too much oil on the market right now. Oil’s bounce back could play a major factor in the markets success or suffering this summer.
Related: Stocks leave consumers in the dust. But can it last?
2. Show me the earnings!
American companies have had lukewarm earnings growth this year. A strong dollar and China’s slowdown are among the culprits bringing growth down.
S&P 500 companies earnings per share growth is hovering around 2.9% in the first quarter compared to a year ago. That figure was slightly less last year, but again, earnings growth in the first quarter is much weaker compared to previous bull market years.
1. God bless America more, please
America’s economy isn’t picking up the slack. Economic growth in the first quarter was nearly flat and the Atlanta Fed’s second quarter forecast projects to be less than 1%. Last year economic activity bounced back after a sluggish first quarter. It doesn’t look like that’s happening this time around.
Many economists still see America gaining momentum later this year, but it could be too little too late for 2015.