At the start of each year, we like to take a closer look at what happened over the last twelve months. This helps us gain a better perspective of our economic standing, as well as a clearer view of what’s to come in 2017.
Let’s refer back to the total returns for 2016:
As for 2017, we seen a couple of investment themes coming into play.
- S. economic expansion is poised to improve in 2017/2018; overseas growth remains subdued.
- Low recession risk and a rebound in corporate earnings point toward continuation of the U.S. equity bull market.
- President Trump’s election victory has accentuated key inflection points:
- Fiscal stimulus will be ascendant as the Fed’s monetary stimulus recedes.
- S. deficit financing is likely to increase in the years ahead.
- The bond bull market that began in the early 1980s is likely over; higher yields are expected in the future.
- Investors must be ready for bouts of volatility driven by unquantifiable uncertainties:
- More “populism vs. the establishment” elections in Europe.
- Intentionally unpredictable nature of the Trump administration, both in terms of policies and messaging.
- China’s management of a slowing private sector, capital outflows, and a potential increase in tensions with the U.S.
How can you utilize the current economic trends to tweak your financial plan?
It can be tricky to stay on top of personal financial goals with the constant chaos surrounding us. Take a moment to note what went well for you in 2016, what didn’t go so well, and a couple of key financial goals you’d like to accomplish in 2017.
As always, the GunnChamberlain team is happy to help however we can to ensure your best financial future.
Sources: WSJ, Bureau of Economic Analysis, Time.com, JP Morgan Asset Management