2018 Economic Outlook Events Underway in Multi-Markets
Posted on February 2, 2018
Top: Craig Holston, COO; Al Hanser, Founder and Chairman; Dick Pyle, President, and Joel Johnson, Assistant VP, Investments gather before the program at The Sanctuary Golf Club. Bottom: A record number attended the Economic Outlook for The Naples Trust Company at The Club at Pelican Bay last week where Chief Investment Officer, Ian Breusch, CFA and Director of Research, Tim Vick presented.
The Sanibel Captiva Trust Company was first in line to hold their annual Economic Outlook at The Sanctuary Golf Club to a full room of clients and special guests. Similar presentations have just been completed in Naples, Tampa, Belleair and Lakeland.
Sanibel Presenters, Dick Pyle, President and Craig Holston, Chief Operating Officer / Senior Portfolio Manager brought guests up to date with an overview of investment and economic activity throughout 2017, and then looked forward with expectations for 2018.
Holston started off the program discussing 2017 market performance highlighting that Large U.S. Stocks finished up 22.2%; Small U.S. Stocks finished up 15.1%; Foreign Stocks up 23.9%; Emerging Market Stocks up 35% and Corporate Bonds up 3%. Contributing to economic growth was the sharp decline from 2014 at 8.25% unemployment through 2017 down to 4.10%.
“GDP was up 20% through 2017 and inflation rates were soft,” according to Holston. “The GDP outlook is 3+% for this year and next, with inflation remaining well-contained.” Regarding U.S. Treasury Bonds, Trust Company analysts are watching interest rates. Currently bonds have low to little change, but banks are leaning toward rates going higher, which can affect corporate profits. Pyle said, “We’re not buying bonds currently, unless specifically requested by the client for special circumstances. At this point, the value of a bond will decrease for every percentage increase in interest rates and is not optimum for most portfolios.”
Holston touched on market timing and how to avoid being emotionally influenced by most world events when it comes to investing. A slide entitled, “Shocks That Didn’t Shock” demonstrated the resiliency of the stock market beginning with the Cuban Missile Crisis in 1962 to today. “The market may experience momentary dips due to dramatic events, but historically has climbed right back to its previous high and beyond within a few days,” said Holston. He emphasizes consistency in investment strategy.
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