Markets Soar as Global Monetary Stimulus Inspires Confidence

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  • Investors responded to abated risks in Europe, temporary relief from fiscal cliff concerns and the largesse of the Fed punchbowl with the best January returns in years.
  • Nevertheless, fundamentals ultimately drive markets, and concerns —notably, weak third quarter earnings and the threat of the coming “sequester” — remain
  • The rally highlights the folly of gaming diversification —holding cash is a costly response to market uncertainties — and we hope January’s enthusiasm will help lure groundhog-savers out of their holes

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