The FPC Team has pulled together our Q4 2019 market review. Outlined here are a few of the key themes we’re observing right now.
Current Market Updates
Since the beginning of 2020, we’ve seen U.S. markets launch and continue a trend that indicates strong Q1 performance. Global markets kicked off the new year on a positive note as they continued to benefit from the quantitative easing. In keeping with this trend, we continue to see low interest rates. In some places, interest rates are actually negative.
Unemployment
Unemployment is at 50-year record lows. Additionally, despite unemployment being at an all-time low, we’re seeing the largest budget deficit during a time of full employment.
Oil & Global Markets
Oil has remained reasonable and is likely to stay there throughout Q1 of 2020. However, rising tension in the Middle East is something to keep an eye on. Despite these tensions, the U.S is the largest oil producer in the world, so any price spikes are not expected to be long-lasting.
Summary
In general, despite some fluctuation in the global markets over the course of Q4 2019, the U.S. markets have remained strong. Although nobody can predict the market from one quarter to the next, things are currently looking as though a strong market will continue through Q1 2020. The two biggest things to watch are the tensions in Iran, and political ups and downs as we move through an election year in the U.S.
Q1 2020 Outlook
Despite the media’s projections and fear-based reporting in Q3 and Q4 of 2019, there appears to be little chance of a recession in the near future. However, as is always the case in an election year when both the Presidency, as well as congressional seats, are up for change, there’s a possibility of market fluctuation.
The same is true for global events such as Brexit and the trade issues currently happening around the world. As these international shifts continue to work themselves out, we should have a clearer picture of how they’ll impact the global. markets.
Q1 Financial Planning Reminders
At this point in the economic cycle, when things are going well, it’s always good to keep your cash reserves in mind. One of the best ways to guard yourself against potential recession, or even just a dip in the market, is to maintain a reserve of cash.
In non-market related news, tax season is upon us! That means it’s time for our FPC clients to upload your tax documents! Watch the video below for more information on the specific documents we need, and how to send them in!
