Market Commentary: Fourth Quarter January 18, 2022
Every year on New Year’s Day, I look at Google Trends and reflect on what people searched for during the year. For me, it gives me time to reflect on just how many things happened during the year, how fast topics of interest changed, and what kind of information people looked for. It certainly does not come as a surprise that in the United States, six of the top ten most searched news items involved money or investments.
#1 was “Mega Millions” – the multi-jurisdictional lottery game. It has had jackpots exceeding $1.5 billion – so if you played that lottery game, I could see why you would search for it. Globally, people searched for “What is a meme stock?” and in the U.S., the #2 search was “AMC Stock.” AMC Entertainment Holdings, Inc. is a NYSE listed company whose stock price went from about $1/share to $60/share in a matter of months. #5 was “GME” or GameStop Corporation which is also a NYSE listed company whose stock price increased from about $20/share to $350/share fueled by internet trading chat rooms. There ended up being a fair amount of controversy surrounding these and other companies which I addressed in an article I composed early last year to provide our clients with a summary of what was going on. #6 and #10 on the list involve digital assets (the term asset is loosely defined here because what do you call something you own but can’t physically hold or really describe?) with #6 being “Dogecoin” – a cryptocurrency (the term currency also being loosely defined) designed as a ‘joke’ to make fun of the wild speculation in cryptocurrencies. Amusingly, the search for “How to pronounce Dogecoin” was also very high. Rounding out #10 was “Ethereum Price” – another cryptocurrency.
So that was 2021 – and I expect that 2022 will have its fair amount of money and investing related searches as well. The stock markets were generally good with the S&P 500 Index gaining 11.03% for the quarter, increasing its year end gain to 28.71%. Small companies represented by the Russell 2000 gained 2.14% for the quarter, for a year end gain of 14.82%. International stocks represented by the iShares MSCI EAFE Index gained 2.69% for the quarter, up 11.26% for the year. Bond prices dropped with increased speculation that interest rates are going to be rising soon, with a quarterly loss of -0.72% for the Barclays US Gov/Credit 1-5 Year Index, extending the YTD loss to -0.97%.
As always, thank you for letting Petersen Hastings help you in achieving your financial goals, and we all wish you a Happy New Year!