Thursday, August 21, 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

Railroad crossing stalemate continues

By Barry Eberling | From Page: A1, 3 Comments

 
First day back to school brings laughter, jitters

By Susan Hiland | From Page: A1 | Gallery

Potrero Hills Landfill legal appeals exhausted

By Barry Eberling | From Page: A1

 
Breakfast after the Bell wins support

By Mayrene Bates | From Page: A2, 3 Comments

 
Suisun city employees get pay raise

By Ian Thompson | From Page: A3, 1 Comment

 
Fairfield candidates hear about lean, nimble city staff

By Ryan McCarthy | From Page: A3 | Gallery

Free e-waste collection to benefit Scarlet Brigade

By Susan Hiland | From Page: A4

 
Fairfield mayor to appear at GOP dinner

By Susan Hiland | From Page: A4, 2 Comments

Girls on the Run seeks volunteer life coaches

By Ian Thompson | From Page: A4

 
College finalizes police department takeover, OKs bond plan

By Amy Maginnis-Honey | From Page: A4

 
Weather for Aug. 21, 2014

By Daily Republic | From Page: B10

Fairfield police log: Aug. 19, 2014

By Susan Hiland | From Page: A10

 
Suisun City police log: Aug. 19, 2014

By Susan Hiland | From Page: A10

.

US / World

Militants use British killer as propaganda

By The Associated Press | From Page: A1

 
Governor criticizes new-hire pension enhancements

By The Associated Press | From Page: A1

US mission to rescue hostages in Syria failed

By The Associated Press | From Page: A1

 
US official: More airstrikes in Iraq

By The Associated Press | From Page: A1

Beheading spurs new attacks on Islamic militants

By The Associated Press | From Page: A1, 5 Comments

 
School sorry for making special ed kids sort trash

By The Associated Press | From Page: A4

Police seek mystery pair in selfies after burglary

By The Associated Press | From Page: A4

 
Teens deny threatening boy in school shooting plot

By The Associated Press | From Page: A5

Panel OKs state librarian despite initial concerns

By The Associated Press | From Page: A5

 
North Korea insults John Kerry over his looks

By The Associated Press | From Page: A10

Ukrainian govt troops take over much of Luhansk

By The Associated Press | From Page: A10

 
Picture emerges of officer in Ferguson shooting

By The Associated Press | From Page: A10, 7 Comments

Navy kicks out 34 for nuke cheating

By The Associated Press | From Page: A10

 
CHP says officer may face serious beating charges

By The Associated Press | From Page: A10, 1 Comment

8 homes destroyed, 1,500 threatened by wildfire

By The Associated Press | From Page: A10

 
Drought has state debating its unregulated pumping

By The Associated Press | From Page: A10

Holder says he understands mistrust of police

By The Associated Press | From Page: A10

 
Liberian slums barricaded as Ebola sets new record

By The Associated Press | From Page: A10

.

Opinion

Editorial Cartoons: Aug. 21, 2014

By Daily Republic Syndicated Content | From Page: A7

 
California needs pedestrian-friendly neighborhoods

By Letter to the Editor | From Page: A7, 2 Comments

 
Tell the story, don’t be it

By Ruben Navarrette | From Page: A7

 
We’re spending way too much on raising our kids

By Megan Mcardle | From Page: A7

.

Living

Today in History: Aug. 21, 2014

By The Associated Press | From Page: A2

 
Community Calendar: Aug. 21, 2014

By Susan Hiland | From Page: A2

Horoscopes: Aug. 21, 2014

By Holiday Mathis | From Page: A9

 
Why do parents drink alcohol after their children’s games?

By Kathy Mitchell and Marcy Sugar | From Page: A9

.

Entertainment

TVGrid

By Daily Republic Syndicated Content | From Page: A5

 
Emmys: Billy Crystal to pay tribute to Williams

By The Associated Press | From Page: A6 | Gallery

And the Emmy winners are…? We’re happy to guess!

By The Associated Press | From Page: A6 | Gallery

 
Aniston, Hamm, Hudson set to Stand Up to Cancer

By The Associated Press | From Page: A6

.

Sports

Peavy pitches Giants to 8-3 win over Cubs

By The Associated Press | From Page: B1

 
WR Stevie Johnson adds depth to 49ers

By The Associated Press | From Page: B1

Fairfield boxer Avila set to put perfect 15-0 record on the line

By Brian Arnold | From Page: B1 | Gallery

 
Giants win protest, rain-shortened game to resume Thursday

By The Associated Press | From Page: B1

A’s stumble and must regroup with Angels coming

By The Associated Press | From Page: B1

 
Raiders FB Reece’s injury not as bad as feared

By The Associated Press | From Page: B1 | Gallery

Reality check for Phelps at Pan Pacific Champs

By The Associated Press | From Page: B2

 
Kent State starting center dies at 21

By The Associated Press | From Page: B2

Serena Williams seeded No. 1 at US Open; Halep 2nd

By The Associated Press | From Page: B2

 
Tony Stewart skipping 3rd straight race after Ward’s death

By The Associated Press | From Page: B2 | Gallery

Las Vegas spoils Mo’ne’s night, beats Philly 8-1

By The Associated Press | From Page: B2 | Gallery

 
Sharks F Torres undergoes surgery on right knee

By The Associated Press | From Page: B2

US routs Dominicans in exhibition as Rose rests

By The Associated Press | From Page: B2

 
Schilling blames chewing tobacco for mouth cancer

By The Associated Press | From Page: B2

Sports on TV for Thursday, Aug. 21, 2014

By Paul Farmer | From Page: B4

 
This date in sports history for Thursday, Aug. 21, 2014

By The Associated Press | From Page: B4

.

Business

BofA reaches $17B settlement with US

By The Associated Press | From Page: B5

 
Brine firm sues over biblical fracking billboard

By The Associated Press | From Page: B5

Apple’s stock bounces back to hit a new high

By The Associated Press | From Page: B5

 
.

Obituaries

David G. Gibson

By Nancy Green | From Page: A4

 
Charles (Chuck) H. Doty

By Susan Hiland | From Page: A4

George ‘Wayne’ Hause

By Nancy Green | From Page: A4

 
Sharon Ilene Boyd

By Nancy Green | From Page: A4

.

Comics

Zits

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

 
Dilbert

By Daily Republic Syndicated Content | From Page: A8

Frank and Ernest

By Daily Republic Syndicated Content | From Page: A8

 
For Better or Worse

By Daily Republic Syndicated Content | From Page: A8

Beetle Bailey

By Daily Republic Syndicated Content | From Page: A8

 
Get Fuzzy

By Daily Republic Syndicated Content | From Page: A8

Baby Blues

By Daily Republic Syndicated Content | From Page: A8

 
B.C.

By Daily Republic Syndicated Content | From Page: A8

Baldo

By Daily Republic Syndicated Content | From Page: A8

 
Pickles

By Daily Republic Syndicated Content | From Page: A8

Garfield

By Daily Republic Syndicated Content | From Page: A8

 
Sally Forth

By Daily Republic Syndicated Content | From Page: A8

Wizard of Id

By Daily Republic Syndicated Content | From Page: A8

 
Rose is Rose

By Daily Republic Syndicated Content | From Page: A8

Word Sleuth

By Daily Republic Syndicated Content | From Page: A9

 
Cryptoquote

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

Sudoku

By Daily Republic Syndicated Content | From Page: A9