Fourth Quarter Report 2017
Michael D. Kresh CFP ® RF™
Well 2017 is over and we are now starting 2018, so it is time to look at the most important events of last year and think about our resolutions for 2018.
On November 21st, 2016, the Dow closed above 19,000 for its first time in history[i], and by the end of Feb 2017 the Dow had its first monthly close above 20,000. [ii] Regardless of the Dow’s rise in Feb, the single most important day of 2017, in my mind at least, was February 1st the day that Elliot and Jonah Kresh were introduced into the world.
Now, according to major news outlets, this event did not even make one of the top headlines for February let alone all of 2017, what do they know? In fact since February 1st our clients have had probably the highest 11 month aggregate return in our firm’s history. Is that a coincidence, who cares?
There is no question in anybody’s mind that 2017 was full of disturbing headlines. Terrorist attacks in London and New York, mass shootings in Las Vegas, NV and Southerland, TX were among the deadliest in us history.[iii] Three major hurricanes hit Houston, Florida and Puerto Rico, additionally there were massive wild fires in Minnesota and California. Moreover, global political tensions remained constantly in the news, especially between the US and North Korea adding agita to our morning coffee. Yet, through it all, the S&P 500 finished higher every month last year. That has never happened before.[iv]
In hindsight, one can always come up with reasons to explain every market turn. Typically, disturbing headlines have at least short-term effects on our markets, not last year. Well, what made this year different? Every year was and always will be different, expecting tomorrow to be the same as today is potentially perilous.
Interest rates remained very low throughout the year, inflation remained subdued, and these two factors together act to help corporate profits which often lift stock prices. Many will speculate that the anticipation of a major corporate tax cut helped buoy the market. Now that tax reform has been signed into law, only time will tell if this is good or bad for the economy.
As we look forward, we do recognize some important trends, we are living longer, and new technologies disrupting ways of doing business faster than ever. Our futures are unfolding right in front of us, and our mission is to continue guiding our clients into tomorrow, no matter how cold it is out there.
Elliot, Jonah, Dan, Glenda, Lauren, Lori and I wish you all a Happy and a Healthy 2018!
THIRD QUARTER REPORT 2017
Michael D. Kresh CFP® RF™
"The only value of stock forecasters is to make fortune-tellers look good." Warren Buffet
Starting in October 2007, over the next year and a half, US Markets declined more than 50%[i]. Some investors fled the market and have yet to recover. Here we stand ten years later with this key point: If you pulled a Rip Van Winkle on October 9, 2007 and woke up today you would see the US Markets at new all time highs.
Some more wisdom from the ages:
"Far more money has been lost by investors preparing for corrections, or trying to anticipate corrections, than has been lost in corrections themselves.” Peter Lynch
“We have two classes of forecasters: Those who don’t know — and those who don’t know they don’t know.” John Kenneth Galbraith
Since March of 2009, we have been in a bull market. We completely agree that we have no idea what the market is going to do next year, next week, or even tomorrow. We feel that there is no way to grow your true net worth or meet your retirement goals without investing in the market and that equities should be a major part of your overall portfolio. It’s true that the Dow has averaged a “bear market”[ii] around once every three and a half years since 1900[iii]. Through all of that volatility, (including; The Great Depression, WW1, WW2, the Cold War, oil crisis, dot com bubble and Great Recession) it’s up in excess of 29,000%! That’s not a typo![iv]
[ii]The Vanguard Group 07/17/2007
Securities offered through Royal Alliance Associates, Inc., Member FINRA/SIPC
Advisory services offered through Creative Wealth Management, LLC a registered investment advisor.
Not affiliated with Royal Alliance Associates, Inc.