Thursday, September 18, 2014
FAIRFIELD-SUISUN, CALIFORNIA
99 CENTS

Crystal ball view of 2013 blurry at best

sievers column sig

By
From page B7 | January 05, 2014 |

The start of the year brings a flurry of predictions with sage outlooks for the coming year from the talking heads of television and the prognosticators of print. While crystal ball gazing is always entertaining, it becomes even more so a year later.

Many people are on vacations, and the flow of news slows to a crawl. Forecasts about the economy, markets and anything else you can think of (often pointless) fill the empty journalistic space.

A year ago, we suffered through brinksmanship as politicians in Washington, D.C. struggled with their now familiar “fiscal cliff” standoffs. For some, the excitement was just too much. The publication Financial News told its readers that “political storm clouds loom over the global economy. From Washington to Beijing, the financial markets are in thrall to seismic political events.”

In The Economist magazine, the tone about 2013’s prospects was equally skeptical, if not quite as florid. The magazine noted that while surveys showed investors were optimistic, the coming year was unlikely to be one to remember. The supposed reason was that the past year’s gains partly reflected relief that the worst fears about the eurozone had failed to materialize, the magazine said, which meant that reality might intervene as investors judged shares as expensive.

The skepticism was universal. The Australian Financial Review quoted analysts as saying the prospect of rising bond yields and slowing profit growth did not augur well for a repeat of the performance of risky assets seen in 2012. They predicted no end to the volatility that had gripped markets over the New Year period, posing dilemmas for investors wondering how to invest in 2013.

It’s easier to see from all this forecasting that many investors might have taken fright at the developments around the turn of the year and sought to trim their exposures to risky assets because of what the media pundits were saying.

That would have been a shame because, as of the end of 2013, many global equity markets were enjoying record-breaking years. The S&P 500 total return index, for instance, was up by 32.4 percent, its biggest annual gain in more than a decade. In Japan, the total return index finished the year with an astonishing 54 percent gain, its best yearly gain since 1972. In Europe, the return broke 24 percent while the United Kingdom topped 19 percent, both of which are peak levels.

As the new year begins, there are still plenty of gloomy stories to fill the newspapers, including ongoing speculation of what happens when the U.S. Federal Reserve begins tapering its monetary stimulus program.

This isn’t to say these stories are necessarily incorrect. Most of them accurately reflect the sentiment prevailing at the time they were written and the uncertainty about the future, as expressed in prices.

But as an individual investor, there is not much you can do about that. These expectations and uncertainties are already built into the market. Investing is about what happens next. We don’t know what happens next. That’s why we diversify.

Think about this: If any of the gurus who regularly appear on financial television or in the newspaper really had a crystal-clear view of the future, why would they bother sharing it with the world?

It makes more sense to focus on what’s in your own control. In the meantime, many happy returns!

Mark Sievers, president of Epsilon Financial Group, is a certified financial planner with a master’s in business administration from the University of California, Berkeley. Contact him at mark@wealthmatters.com.

LEAVE A COMMENT

Discussion | No comments

The Daily Republic does not necessarily condone the comments here, nor does it review every post. Read our full policy

.

Solano News

 
Theatre DeVille in Vacaville closes

By Barry Eberling | From Page: A1, 15 Comments | Gallery

 
Focus on school attendance now, always

By Mayrene Bates | From Page: A2, 1 Comment

 
Suisun City Senior Center seeks holiday donations

By Susan Hiland | From Page: A3

Lunafest returns to Fairfield in November

By Susan Hiland | From Page: A3

 
Pepperbelly’s for sale

By Ryan McCarthy | From Page: A3, 4 Comments

Jury selection begins in 2011 Fairfield murder trial

By Jess Sullivan | From Page: A3

 
Seniors get help at Kroc Center health fair

By Barry Eberling | From Page: A3 | Gallery

Drug court success stories tell their tales

By Jess Sullivan | From Page: A3 | Gallery

 
Fairfield police log: Sept. 16, 2014

By Susan Hiland | From Page: A10

 
Suisun City police log: Sept. 16, 2014

By Susan Hiland | From Page: A10

Weather for Sept. 18, 2014

By Daily Republic | From Page: B10

 
.

US / World

Emotions mount on final day of Scottish campaign

By The Associated Press | From Page: A1

 
More than 2,000 homes threatened in California fire

By The Associated Press | From Page: A4, 1 Comment

Maps provide early warning of California fire risk

By The Associated Press | From Page: A4

 
NASA’s Maven spacecraft reaches Mars this weekend

By The Associated Press | From Page: A5

US military role in Iraq raises combat questions

By The Associated Press | From Page: A5

 
Police: Ambush suspect was military re-enactor

By The Associated Press | From Page: A5, 1 Comment | Gallery

House grudgingly approves arms for Syrian rebels

By The Associated Press | From Page: A5, 2 Comments

 
Ex-VA doctor: Phoenix report a ‘whitewash’

By The Associated Press | From Page: A5, 1 Comment

School district police stock up free military gear

By The Associated Press | From Page: A5, 4 Comments | Gallery

 
Doctor says Toronto Mayor Rob Ford has cancer

By The Associated Press | From Page: A6

US scientist: Ebola unlikely to become airborne

By The Associated Press | From Page: A6

 
Liberia president praises US for Ebola help pledge

By The Associated Press | From Page: A6

Obama reaffirms opposition to US combat in Iraq

By The Associated Press | From Page: A6, 1 Comment

 
AP Interview: Iraq premier says no foreign troops

By The Associated Press | From Page: A6, 1 Comment

.

Opinion

 
Homeless find welcome in Vallejo

By Letter to the Editor | From Page: A7, 7 Comments

 
Give new crime report a chance

By Kelvin Wade | From Page: A7, 19 Comments

 
.

Living

Today in History: Sept. 18, 2014

By The Associated Press | From Page: A2

 
Community Calendar: Sept. 18, 2014

By Susan Hiland | From Page: A2

Horoscopes: Sept. 18, 2014

By Holiday Mathis | From Page: A9

 
My brother fails to make an effort to when it comes to my kids

By Kathy Mitchell and Marcy Sugar | From Page: A9

.

Entertainment

TVGrid

By Daily Republic Syndicated Content | From Page: B4

 
U2 returns to iTunes Top 100 — 26 times

By Los Angeles Times | From Page: B4, 1 Comment

Directors Guild finds TV diversity hiring stalled

By The Associated Press | From Page: B4

 
.

Sports

Rodriguez gets 1st MEL soccer win since return to league

By Daily Republic staff | From Page: B1

 
Giants snap tie in 9th, beat Arizona to narrow gap in West to 2

By The Associated Press | From Page: B1

 
49ers’ Kaepernick fined for inappropriate language

By The Associated Press | From Page: B1, 4 Comments | Gallery

Panthers remove DE Greg Hardy from active roster

By The Associated Press | From Page: B2

 
Barry Bonds appeal heads back to court

By The Associated Press | From Page: B2

NFL, union agree to new drug policy, HGH testing

By The Associated Press | From Page: B2

 
Raiders rookie Derek Carr focuses on job at hand

By The Associated Press | From Page: B2 | Gallery

Pegulas’ bid to buy Bills OK’d by NFL committee

By The Associated Press | From Page: B2

 
FSU benches Winston for 1st half of Clemson game

By The Associated Press | From Page: B2

Umpire West suspended 1 game for grabbing jersey

By The Associated Press | From Page: B2

 
After making ‘mistake,’ Vikings bench RB Peterson

By The Associated Press | From Page: B2

Sharks sign D Braun to 5-year, $19 M extension

By The Associated Press | From Page: B2

 
Rockets acquire Jason Terry, picks from Kings

By The Associated Press | From Page: B2

.

Business

Wells Fargo pays $290,000 in sex harassment case

By The Associated Press | From Page: B5

 
Fed signals plan to keep key rate at record low

By The Associated Press | From Page: B5

Brown signs ride-sharing insurance legislation

By The Associated Press | From Page: B5

 
US homebuilder confidence soars in September

By The Associated Press | From Page: B5

Anthem, hospitals join to offer new insurance plan

By The Associated Press | From Page: B5

 
Drag queens dress down Facebook over names

By The Associated Press | From Page: B5, 1 Comment

.

Obituaries

Margaret King

By Susan Hiland | From Page: A4

 
.

Comics

Baldo

By Daily Republic Syndicated Content | From Page: A8

 
Get Fuzzy

By Daily Republic Syndicated Content | From Page: A8

For Better or Worse

By Daily Republic Syndicated Content | From Page: A8

 
B.C.

By Daily Republic Syndicated Content | From Page: A8

Garfield

By Daily Republic Syndicated Content | From Page: A8

 
Frank and Ernest

By Daily Republic Syndicated Content | From Page: A8

Rose is Rose

By Daily Republic Syndicated Content | From Page: A8

 
Pickles

By Daily Republic Syndicated Content | From Page: A8

Baby Blues

By Daily Republic Syndicated Content | From Page: A8

 
Beetle Bailey

By Daily Republic Syndicated Content | From Page: A8

Peanuts

By Daily Republic Syndicated Content | From Page: A8

 
Blondie

By Daily Republic Syndicated Content | From Page: A8

Zits

By Daily Republic Syndicated Content | From Page: A8

 
Dilbert

By Daily Republic Syndicated Content | From Page: A8

Wizard of Id

By Daily Republic Syndicated Content | From Page: A8

 
Sally Forth

By Daily Republic Syndicated Content | From Page: A8

Sudoku

By Daily Republic Syndicated Content | From Page: A9

 
Bridge

By Daily Republic Syndicated Content | From Page: A9

Crossword

By Daily Republic Syndicated Content | From Page: A9

 
Cryptoquote

By Daily Republic Syndicated Content | From Page: A9

Word Sleuth

By Daily Republic Syndicated Content | From Page: A9