Just how bad is it internationally? There is a strong current of negative news that continues to flow out of Europe and emerging markets. We are bombarded with attention grabbing articles and negative headlines that paint a dark picture overseas. Headlines such as “Global ransomware attack causes turmoil” and “U.S. downgrades China over trafficking” are just two of the headlines found on BBC’s website recently.
Archived - A Quarter in Review: First Quarter 2017
Political headlines continued to dominate the capital markets during the first quarter. The incoming administration promised new policies such as tax reform, infrastructure spending, and deregulation that could stimulate economic growth. Stock and bond markets had very different reactions to the news. Stocks responded with optimism and priced in the benefits of the new policies, resulting in another strong quarter. The bond market took a wait and see approach to the new administration, wanting to see some progress before responding. The interest rate environment remained stable during the quarter and performance was relatively flat for fixed income. Capital markets will continue to closely monitor activity in Washington D.C. When the American Health Care Act failed to pass in March, investors started to question the administration’s ability to deliver on the other initiatives. Will stock or bond investors be proven right in the end? Only time will tell and our globally diversified portfolios of both stocks and bonds are built for such uncertain times. Investors will be anxiously waiting to see if President Trump can deliver on his promise to boost the economy.
Archived - “Bull markets don’t die of old age”
When will this bull market end? No one knows. Bull markets can last for years beyond expectation and reason. March 9, 2017 marked the eighth year of the current bull market in the U.S. Bull markets in the past have ranged from 2.5 to 15 years with the average bull market lasting 8.9 years. There are many positives in the U.S. today that can continue to support the stock market. The economy continues to grow albeit at a slow pace, labor markets are healthy and company earnings are solid. As a result, the much anticipated and debated rise in interest rates has begun, confirming the Federal Reserve’s belief the economy is healthy.
Archived - A Year in Review: Fourth Quarter 2016
2016 will be remembered as the year of the “unexpected”. After a strong fourth quarter in 2015, many were surprised when the first 6 weeks of the year were the worst start in market history. The decision by the United Kingdom (UK) to leave the European Union (EU) and the election of Donald Trump were the headlines of a very unexpected year politically. The conflict in Syria, the ongoing migrant crises, volatile oil prices and continued geopolitical uncertainty created plenty of reasons to worry about portfolio returns. Yet all major asset classes finished the year with positive returns despite high volatility along the way. In short, 2016 was a reminder that basing investment decisions on current events or forecasts of future events is a fool’s errand. For disciplined investors, 2016 provided solid, if not spectacular, returns despite significant headwinds.
Archived - A Quarter in Review: Third Quarter 2016
Stocks and bonds around the world fared well in the third quarter as the global economy continued to lumber along at a slow pace. The forthcoming presidential election, interest rates and central bank policy continued to dominate economic headlines. As the shock from the Brexit vote faded, markets settled into their familiar summer calm for most of the quarter. September brought with it a brief period of heightened volatility as news out of the US Federal Reserve’s annual Jackson Hole retreat indicated that a rise in interest rates may be on the horizon sooner than the market expected.
What You Should Focus On
The greatest use …
Making decisions …
Taking the first step …
Archived - A Quarter in Review: Second Quarter 2016
Both risky and safe-haven assets alike were on track to finish the quarter comfortably in positive territory until June 23rd when a majority of UK citizens voted to leave the European Union (EU). The so called Brexit rocked financial markets around the world. As a result, stock markets finished the quarter with marginally positive returns and in highly unstable fashion. The global economy continued on a sluggish path, which prompted further caution by central bankers and supported high quality fixed income assets.
Circle of Wisdom
Flat world
”It all happened while we were sleeping, or rather while we were focused on 9/11, the dot-com bust and Enron — which even prompted some to wonder whether globalization was over. Actually, just the opposite was true, which is why it’s time to wake up and prepare ourselves for this flat world, because others already are, and there is no time to waste.” — Thomas Friedman, New York Times, April 2005
Archived - Babies being born, happy couples getting engaged … all good
Information dump
Archived - Why Diversify?
Equity markets experienced a sharp decline to start 2016, causing some investors and analysts to re-evaluate their core investment principles. One common question being asked is whether or not there is a still a need for global diversification, which is not a surprising one given the investment returns so far this decade.
The Times, They are A'Changin'
Bob Dylan’s classic anthem, “The Times They Are A-Changin’,” released in 1964 seems as applicable today as it was 50-plus years ago. But the pace of change has been amplified. A 2015 report by McKinsey & Co. stated, “The pace of change is happening at 10x the speed of the first industrial revolution and the power is 300 times, which equals 3,000 times the impact of the second industrial revolution than the first one.” I think many people would agree.
Archived - Markets Update: First Quarter 2016
If you are just now looking at market returns for the first quarter you would be forgiven for thinking that the markets experienced a relatively boring three months. Developed markets finished flat, emerging markets were finally positive, real estate bounced back from a weak 2015 and bond returns were in the low single digits. However, a lot can happen in three months and what actually transpired was far from dull. January delivered one of the worst starts to a year the S&P 500 index has ever experienced, global recession concerns spiked, oil prices fluctuated wildly and the Chinese economy continued to produce mixed signals. Selling pressure continued through the first week of February
before cooler heads prevailed and the second half of the quarter topped off a whirlwind of action with a significant recovery.
Archived - WWP team reading, puzzling, learning, laughing, traveling
Archived - Markets Update: 2015 Year in Review
2015 provided another example of how dynamic and rapidly changing our world is. Significant events included the highest job growth since 1999, two downgrades to the global economy, the Federal Reserve raising interest rates for the first time since 2006, Russia getting directly involved in the Syrian conflict, which pushed the immigrant crisis to levels not seen since WWII, and a dramatic rise and fall of the Chinese stock market. Despite all these events, 2015 provided quite unremarkable investment returns. US markets were slightly up, European markets slightly down, global real estate and global bonds slightly up and emerging markets down double digits. Volatility is back as markets try to digest the impact of these events and we expect that to continue through 2016.
