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Market Commentary: January 2024

Dear Fellow Investors,

What a finish to 2023! 

With a fourth quarter like that, I had to start with a quote from the late Charlie Munger. This year ended up being a fantastic year if you just stayed invested, or at least didn’t interrupt the compounding.  Like so many times in history, when everyone is expecting one thing, something else happens. Going into 2023, as estimated 70% of economists were expecting a recession. Here we are at the end of the year and not only did a recession not occur, but we had above trend growth. Add to that, inflation continued to fall throughout the year, and it’s no wonder that most assets had a positive year. I wrote a year-end look on the Macro Minute (that you can read by clicking here) so I want rehash it here.

I do want to congratulate you for sticking to it over the last few of years. For many, it was our first bout of serious inflation. For others, it was the first time since the 1970’s, and even for those the whole pandemic thing was new. All in all, it has been a crazy few years. It has left us all changed. It has also ushered in changes to the economy. Five years ago, who could have envisioned so many people working from home and being productive? This led to many home offices being created and lots of businesses reconsidering how much office space is really needed. Is it any wonder that all the prognosticators have been so wrong?

Through all of these changes, the government has been very supportive. Some would say too much so and that it was the cause of the increase in inflation. While that may have been a contributing factor, the biggest factor was that demand for things rose at a time when supply could not keep up due to the COVID lockdowns. As we head into 2024, it is important to remember how drastic the changes have been personally, as a country, and to the world. I for one will try to be cognizant of that while interacting with others and attempt to be more gracious. 

With all of this being said, I want to thank you for allowing us to help you navigate this changing world we find ourselves in. 

Here is to a brighter tomorrow!

Sincerely,

Wes Johnson, CIMA®
Chief Investment Officer

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