Dorothy: Now which way do we go? Scarecrow: Pardon me. That way is a very nice way...[pointing] Dorothy: Who said that? [Toto barks at the Scarecrow] Dorothy: Don't be silly, Toto. Scarecrows don't talk! Scarecrow: It's pleasant down that way too!...[pointing in another direction] Dorothy: That's funny. Wasn't he pointing the other way? Scarecrow: Of course, people do go both ways. [pointing in both directions] That's the trouble. I can't make up my mind. I haven't got a brain. Only straw. Dorothy: How can you talk if you haven't got a brain? The Scarecrow: I don't know. But some people without brains do an awful lot of talking, don't they? Dorothy: Yes, I guess you're right.
I hope you enjoyed the holidays with family and friends, and are ready to start the new year. As we look back, the year past was one filled with surprises, challenges, and no small amount of angst. Worries about China's growth rate, U.S. recession risk, and tumbling oil prices occupied much of the first half of 2016, while concerns over Brexit and a growing sense of nationalism around the world, and the ever-looming next interest rate increase, ushered in the second half.
The stock market's surge following the surprise election result last month has many investors still feeling shell-shocked. Some are even feeling conflicted: Is it okay that my investments are going up because the stock market is cheering the person I didn't vote for? Maybe a more prudent question is how long will the market's "Trump-bump" last? While the answers are subjective, there's more to the recent run-up than just President-Elect Trump.
This time of year many of us are hard at work on our New Year's Resolutions. Maybe the resolutions include changing bad habits, beginning good ones, or simply "getting in shape". While the latter is often about personal health and improving our waistline, don't forget about improving your financial health as well.
Here are some potential resolutions to consider if you still have room on your list:
I'm hard at work finishing up the year but, with the holidays upon us, I'm stealing a little extra time with the family by taking a break from posting this week and next.
From my family to yours, warmest wishes for Happy Holidays, and best wishes for the New Year. May the season and the year ahead bring you joy, good health, and prosperity.
With the sudden market reset over the past several weeks, let's review where things stand year-to-date. Looking broadly at markets, one can clearly see the shift in "risk appetite" away from areas deemed to be too risky in a future Trump Administration (foreign stocks and core bonds), and into U.S. stocks.
Since the election, stocks have continued up while bonds have fell off a bit, but the performance of both has been mixed. To illustrate my point, here is a summary of where the major indexes stand currently, year-to-date (through last Friday) and where they stood at the end of October (green means higher than October, red means lower).
