February 10th, 2020 the Dow Jones Averages hit a new high. Twenty five days later. The Dow average was down about 35%. Nine months later (12/17) the Dow hit a record 30,303.
In the interim between February and December we were devastated by a virus that infected millions of people and killed over 300,000. Serums were scientifically developed in record time and is now In route to locations for all to get shots.
Unemployment went from “full” (less than 4%) to a record 20+%. Some employers recalled employees over those interim months but some states shut down a lot of business and employment staggered.
When the Dems won the Presidency in 2008, Congress raised taxes . Coming out of a Recession, if not a Depression, after the mortgage fiasco, was not the right thing to do. And, the economic recovery took a long time to start I hope Congress doesn’t make the same mistake in 2021. We have so many people hurting after the COVID crises that an increase in taxes will hurt more people. Our economy WILL RECOVER, and the Indexes will reflect that during 2021.
Changes to portfolios might be in order depending what Congress does during the 1st Quarter of 2020. I have always been more conservative in investments than most. Taking some risk along the way, but to a very small percentage. We review our portfolios at least once a week and make changes as necessary. We will continue to monitor economics and new bills proposed by Congress.
I have always been the eternal BULL when it comes to our stock and bond markets. AND I still am. No market goes up all the time and conversely none goes down all the time. I expect that we will see. new highs again during the first quarter, but I also expect continued volatility. Perhaps nothing like we saw in February and March (2020), but days that may make people nervous. Stay the course!