By: Hemant P. Singh
Director & Certified Financial Fiduciary KS Capital Management, Inc “It was the best of times, and it was the worst of times.” This Dickins quote is certainly reflective of the 2022 stock market as it went down in the books with that moniker. For the year, the equity markets had to deal with a shooting war, inflation, an oil price shock, rising interest rates, a recession risk, and a political division presided over Jan 6th events. The Fed, China, and the Ukraine war provided a difficult backdrop leaving the equity markets down for the 4th worst performance year since 1945 and the worst since 2008. The Best of times- 2023 Outlook_ The issues that plagued the markets can be placed squarely at the feet of the US Federal Reserve as their aggressive rate hike cycle was explicitly designed to reduce asset and inflation bubbles. That was then and this is now. It’s been 12 months since the Fed started and we believe there is enough evidence in the economy to help the Fed not just Pivot but Pause this rate hike stance. When this happens we believe the markets are poised to recover their deficit, aggressively. History is a guide. We are sharing our Annual Presidential Chart that shows the market has never had a negative 3rd year of any President’s term. No one predicted the Pandemic in 2020, so history can be repeated or made. We are in the camp of the known and have spent the past several months re-investing the portfolios to the highest conviction and objective-based ideas. We have attached an S&P Total return chart to illustrate that the 3rd yr. of a President has always been a positive return. Please note the 3rd year performance when the 2nd year is negative. It’s very impressive and relevant !!
3 Comments
AB
1/9/2023 04:29:46 am
Very interesting and thoughtful.
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Jake C
1/14/2023 01:03:02 pm
Thank you for this info
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Sunil K
1/20/2023 03:14:15 am
Is this updated ?
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