Taking a stab at listing the “Top 5″ or “Top 10” events of 2023 is challenging – and subjective. Less subjective is highlighting two events that got the attention of nearly all participants in US stock and bond markets in 2023:
Alert: “Getting into the weeds” here in a brief discussion on inflation and why it may not be easy to solve quickly. Bullet points below may help.
There is a bit of a “chicken or the egg” scenario when it comes to inflation.
Another quick edition today, as the message is a cautionary one.
The rate of inflation has continued to increase recently. The Wall Street Journal quotes the nationwide inflation rate now at 7.9%. Most clients and friends with whom I speak say they feel little pain and that all they notice about inflation so far is the rising cost of gas and higher grocery store bills. How much longer will inflation continue “not to matter”? What if the US Federal Reserve gets impatient and starts raising rates more aggressively?
Inflation has a funny (not “haha” funny) way of changing consumer and market behavior. We are presently seeing these changes play out in the economy and stock and bond markets. Time for the rocket photo again, which equates rapidly increasing prices with a rocket launch.*
In conversations with clients and friends in every segment – younger newly-employed, mid-career folks, parents, single people, workers at the tops of careers, those not in the workplace, heads of families and (mostly) comfortably retired folks – every one of these groups reports noticing inflation in their daily lives. This fact is unlike any time in my 35+ year professional life…and then some.
Originally titled, “Practical Suggestions, part 2” this edition of TGIF 2 Minutes covers a topic more related to “Is This Time Different?”
Related to a specific situation or event, most everyone has heard the bold acclamation, “This time is different!” Then, there are those who firmly believe that times are NEVER different… and that time simply repeats itself but with different nuances.
Looking at today, who is correct? The past 12 years are evidence of BOTH.
Staying positive in a negative interest rate world just got a little easier. Sweden’s central bank, one of the world’s first to lower benchmark interest rates to below zero, this week raised its rate up to zero from negative 0.25%, or -0.25%.
After a year – really a decade – of excellent returns in the stock market, and for 2019 in the stock AND bond markets, it makes sense to ask, “WHAT IF?” As in, what if certain events take place in the markets or economy that could spoil the last several years of positive portfolio returns? Naturally then, there would be a handful of guesses or responses to the “what if” questions.
