Thankful For Opportunities

This week we'll take a break from our typical pop culture theme to weave some thankfulness into our abbreviated musings. As we prepare to hit the road to greet or receive loved ones and friends for a traditional meal, we should take some time to be thankful for what this year in the markets has provided and to prepare ourselves for the road ahead.

The performance of markets in 2024 should make corporations thankful for investors, clients thankful for financial advisors, and financial advisors thankful for an industry with improving tools to help clients with their needs. The following is a quotation from a poem entitled, "A Thanksgiving Blessing" by Rick Cotton to help get your heart in the right place for the holiday:

"Now I step inside; oh, it's warm! Oh, that smell!

Hot turkey roasting, potatoes done well!

Sweet, spicy cider, and warm winter wine

Cranberry sauce - Oh! - the flavors - divine!

The smiles and hugs are so warm and sweet.

In this cold gray November, a Thanksgiving treat.

I do love it all and am so thankful; yes,

For this lovely season...I am truly blessed."

Here's what we've seen so far this week...

Markets Still Frothy. While investors continue adding to equity positions, stocks march higher, pushing valuations into the stratosphere.

While the intermediate-term prospects for significantly higher equity returns stand in contrast to historical norms, stocks may continue their current trajectory in the short-term. As we noted last week, the 3rd year of a bull market tends to be in the single-digit range. In addition, when equity markets have risen by more than 20% in back-to-back years, the following year tends to be lower or negative. Diversification is the key to continuing to participate in rising equities while also managing risk and keeping perspective. As Warren Buffet once famously said, "Be fearful with others are greedy and greedy when others are fearful."

Sustainable? The U.S. consumer has been resilient over the past 4 years in the shadow of a pandemic that has skewed markets and economies worldwide.

However, the consumer has added to personal debt at a significant pace over the past couple of years while interest rates were on the rise. In fact, interest rates on credit cards are at all-time highs while delinquency rates are climbing. The average credit card assesses a rate of 23.4% currently. As the holiday (retail shopping) season approaches, this could put a portion of consumers in a bind. Time will tell if we have a plentiful or subdued holiday purchasing season.

I wish each of you and your families a warm and happy Thanksgiving!

Disclosures

The information contained herein is for informational purposes only and is developed from sources believed to be providing accurate information. The opinions expressed are those of the author, are for general information, and should not be considered a solicitation for the purchase or sale of any security. The decision to review or consider the purchase or sell of any security should not be undertaken without consideration of your personal financial information, investment objectives and risk tolerance with your financial professional.

Forecasts or forward-looking statements are based on assumptions, may not materialize, and are subject to revision without notice.

Any market indexes discussed are unmanaged, and generally, considered representative of their respective markets. Index performance is not indicative of the past performance of a particular investment. Indexes do not incur management fees, costs, and expenses. Individuals cannot directly invest in unmanaged indexes. The S&P 500 Composite Index is an unmanaged group of securities that are considered to be representative of the stock market in general.

Past Performance does not guarantee future results.