CMW MONTHLY MONEY PULSE™

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February 2, 2018
CMW MONTHLY MONEY PULSE™

Our last “Pulse” came out the end of November 2017 with very positive news going into the year’s end.

That good news was coupled with an optimistic outlook for further market advances into this year. Our report felt oddly out of character for the cautious tone we tend to take here. Even so we were hard pressed to imagine anything undoing the global market rally that 2017 was turning in.

As it turns out, underlying economic conditions seen across the world’s economies continue to advance well ahead of markets in our opinion. As the Conference Board reports, “In 2018, the US economy is expected to continue its improved growth. In the short term, consumer demand growth will stay strong as the labor market continues to tighten.”

Additionally, while the media shouts horrors over frothy stock prices and bubbles, we believe investors remain more nervous than greedy. That bodes well for near term positive expectations too. So far, these have been exceeded not only in stock performance, but in economic news supporting market expansion as well.

With the great performance we’re seeing, we ask you to heed this warning. While last year witnessed one of the most outstanding global market rallies ever, it did so in the absence of normal market volatility. We don’t expect this rally to escape normal volatility going forward. In fact, we believe the next correction will be heralded by the media as the beginning of the long predicted end of the stock market we’ve been warned of since October, 2009.

Remember, we don’t predict what the market will do or when. Instead, we build portfolios to weather the storms that are a normal part of market cycles. Part of our strategy includes helping you absorb the bumps and shocks emotionally as well as we expect your savings to hold up through the turbulence.

Here’s are some performance points to take in while preparing for whatever ups and downs the market takes us through on the way up for the remainder of 2018.

  • The S&P 500 gained 6.1% in 4Q17, and then added another 7% in January for a 13% gain over just four months.
  • Nine of the 12 Conference Board’s global Leading Economic Indicators were again positive.
  • The US LEI increased 0.6% along with an up-tick in already high consumer and CEO confidence.
  • The Tax Cut and Jobs Act of 2017 passage is no doubt bringing more wind to the back as well.

It’s going to be interesting to see the trade-offs this year between continued progress in the economy and potential re-emergence of market volatility.  Hang on for what we anticipate will be a good ride!

Indexes are listed in respective order to their reference above: S&P 500 TR. These materials have been prepared solely for informational purposes based upon data generally available to the public from sources believed to be reliable. All performance references are to benchmark indexes. Performance of specific funds will vary from respective benchmarks. Past performance is not an assurance of future results. Each index cited is provided to illustrate market trends for various asset classes. It is not possible to invest directly in an index. These materials have been prepared solely for informational purposes based upon data generally available to the public from sources believed to be reliable. All performance references are to benchmark indexes. Performance of specific funds will vary from respective benchmarks. Past performance is not an assurance of future results. Each index cited is provided to illustrate market trends for various asset classes. It is not possible to invest directly in an index.