“Who knows” was my answer when I was recently asked about my own outlook on the markets for 2018.
Over the last few weeks, my inbox has been flooded by dozens if not a hundred market outlooks by prominent research firms, economists, and strategists. And they are all completely different. Some see significant stock market appreciation while others see little to no growth. Some see more growth in the US than abroad. Others see more growth in the foreign markets than in the US. Some see rising rates to be an issue. Others do not. And some even predict a negative year for the stock market. Chances are they are all wrong!
They are interesting to skim through to understand what they believe are the biggest issues to occur in 2018. But it’s just as fascinating to see what is not included in their outlooks. There are even some research groups that make a living by reading through old Market Outlooks and calling out all the wrong predictions.
Think back to this time last year. Trump was just sworn into office and it seemed like everyone was waiting for some kind of market correction to occur. But it didn’t! Volatility is now way down. Markets have shrugged off much of the bad news that has come out in recent months (such as North Korea). Any market outlook that expressed these kinds of views would have been quickly dismissed if written in early 2017.
It’s a reminder to stay focused on your investment strategy. There is a lot of noise that distracts investors and all to0 often leads them into making poor investment decisions.