Readers were pretty negative when the year 2019 began – with good reason. The financial markets had sunk severely at the end of last year, the government went into a budget shutdown, and many so-called experts were saying that the next recession had already begun. If you like stability, there was very little to feel optimistic about on New Year’s Day when I published this ARTICLE on market forecasts for the year.
What a difference a half-year makes. While Goldman Sachs was calling for just 5% growth (after -6% in 2018), the S&P500 has blazed forward with 19% already. It’s the half-year the market has seen in more than two decades. It’s made a big impact on our FIRE nest egg. These are the four key measures I generally watch:
- US Stock Index / S&P 500 +19.3%
- EFEA International Index +12.5%
- VBMFX Bond Index +4.5%
- MegaCorp stock +39.1%
What a year! I can only remember a few times when our portfolio has hit on all cylinders like this. Since MegaCorp is a ‘defensive consumer stock’, it has often has run counter to the general market returns. Both 2017 and 2018 were miserable. This year, our remaining MegaCorp stock options are gaining back much of the value they had lost.
Of course, historical performance is no guarantee of future results. Only heaven knows what the second-half of 2019 will bring for market performance. The New York Federal Reserve is still saying there is about a 25% chance of recession in the next 12-18 months. That said, it’s nice to be playing with such a strong lead and I’m feeling good on the bet I made on New Year’s Day that the market would be back in the black in 2019.
How is your portfolio looking?
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