Just a quick note to offer some perspective on the (many) headlines floating around.
There are plenty of things to be worried about right now, so I’d like to pause for a second to remember the abundance in our lives.
Especially when so many folks are suffering.
When the world stresses me out, I remind myself to be grateful for what I have.
I'm grateful for my family and friends.
I'm grateful for my health.
I'm grateful to have a roof over my head and food on the table.
I'm grateful to have work that gives me purpose.
What are you grateful for right now?
Let's dive in.
What's going on with markets right now?
A lot of fear, volatility, and sudden relief, I think.
We just experienced three months of losses while markets were driven by fear.
And then a sudden bounce on jubilation that the Federal Reserve might be done raising rates this year.1
These whips and snaps are not an unusual pattern for markets. It's common to see major drops just about every year. The chart below shows annual market pullbacks since 2000.
We can see that 10%+ corrections have happened in 15 of the last 23 years, even in years where the overall market was positive.2
What will markets do next?
That's hard to say because we've seen "good" news get mixed reviews by traders.
Recent data shows that the economy seems to be doing well.
Consumer confidence remained high in October, showing Americans are feeling pretty upbeat.3
Paychecks rose more than expected in Q3, which is great news for American workers, but suggests inflation remains persistent.
The first estimate of Q3 GDP showed that the economy grew even faster than expected, growing 4.9% at an annualized rate.4
If investors feel optimistic about future business prospects, the rally could continue.
However, they could get fearful again if the Fed signals another hike or recession headlines return.
Bottom line, while the economy is still strong, investors are feeling jittery.
It’s hard to know which way markets will turn next and we're expecting more volatility ahead.
When the world stresses you out, remind yourself of all the things you have to be grateful for. Keep these in mind in the new year ahead.
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Sources