27 Nov Market Update Fall 2017
This year has been characterized by a friendly environment of low volatility and steady price increases across the board. The low volatility and lack of big price movement is setting records. This can be attributed to positive corporate earnings, growing consumer confidence, and steady economic growth. In fact, most every major economy around the world is experiencing positive growth which has not happened for quite some time.
Most stock markets are experiencing double digit gains so far and bonds are posting low single digit gains. Interest rates are starting to rise more aggressively which is welcome news for conservative investors who have been dealing with near zero rates for the last 10 years.
The positive news for markets and the economy goes on despite the political volatility. We are asked about what effect this has on markets, and our answer remains rather boring; we do not think it has much bearing at all outside a significant war conflict which is not predictable nor likely.
Although this year has been rewarding, there will obviously be pullbacks and volatility in the future. This environment is an outlier and will be difficult to repeat even though we wish otherwise. As long as growth remains positive and steady around the world, investors should continue to be rewarded and we think this can last for a while longer. We will remain optimistic until the data starts to signal a more dire shift.
Ron Sklar & Saxon Knight