By almost every measure 2019 was an exceptional year. Not only did the stock market in the U.S. and globally have their best year since 2013, bonds also rallied, returning more than 8% and turning what was projected to be a ‘bad bond year’ into an excellent one. Stock prices continued to rise for the simple reason that corporate profits continued to grow, backed by strong economic data, particularly in the United States.
As we outlined in our weekly emails, the U.S. consumer remains one of the bright spots in the global economy as consumer confidence hit 20-year highs, jobs remained plentiful, unemployment remained at multi-decade lows, and wages continued to rise. International economic data was weaker than the U.S., weighed by the trade war between the U.S. and China, but global markets still managed to return more than 26% for the year.
Of course, it is important to remember that 2019 started with depressed stock prices and the exceptional rally of 2019 was at least partially a recovery from the 20% decline in the fall of 2018. The rally started the day after Christmas 2018 and in a sense, 2019 was the “Christmas rally that lasted all year”. (If only every day could be like Christmas!)
As we close another year, we want to take a moment to thank our clients for your trust. It truly is a pleasure to work with all of you. We hope that our work and advice has helped enrich your lives – and not just monetarily. We remain keenly aware that the best financial planning and investment management is done in the context of our client’s lives, and the decisions that we make have real world implications for your goals and dreams.
We are excited to learn what 2020 will bring and will continue to work hard to earn your trust and provide excellent service. While we never know what a new year will bring in the market, we are confident that our planning steps, and investment methodology will help our clients weather the good and bad markets. We do remain cautiously optimistic, but we are also realistic that there are always market cycles and we must be prepared for them.
We are also glad to be walking along-side you through the changes in your lives. I am sure that 2020 will bring both joys and sorrows, and we seek to give you wise counsel no matter what comes. Happy New Year! May you have a blessed 2020!