View from the Chair: Windermere's Market Outlook (January 2017)

2016.  What a year.  Looking back a year ago, it's safe to say that very few investors would have predicted the market results that we experienced.  A summary of various market returns for the year is provided below

The year opened with angst over China growth and energy prices, causing equity prices to fall by almost 10% in the first two months of the year.  A rebound soon followed, only to have June bring more volatility as Britain exited the EU.  As the year progressed, the US dealt with its own uncertainty as it awaited its November election. 

November 8th arrived, and while the outcome surprised many (including pollsters), equity markets celebrated the results (S&P 500 up almost 5% since that time).   The US dollar has touched new highs and oil continues to rebound.  The Federal Reserve, recognizing the upswing in inflation and decline in unemployment, began raising rates and indicated its intention to continue into 2017.  

Where does this leave us for 2017?  If we had to sum our market outlook up in one word, it would be:  Hopeful.  No question, 2016 was full on angst and tension as major economic and political shifts took place.  The level of pessimism and negativity was at times surprising and at times understood.   But now the dust has settled, it's a new year, and we are very optimistic when it comes to markets and the ability to grow capital.  We predict the proposals of less regulation, lower corporate taxes, and adjustments to the healthcare system will benefit citizens and companies alike.  Continued economic growth and declining unemployment are also positive indicators.  

America was founded on open borders, meritocracy, and political diversity, and our hope is the continued economic recovery will be all inclusive.   We also hope progress can be made towards enhanced global stability, less political tensions, a global initiative to combat terrorism, and improving living conditions the world over.

We welcome your questions and look forward to guiding your market decisions in the new year.  Invest on my friends!