What would we see if we could get a measure of the U.S. economy by pouring it into a clear glass? Is the glass a little full or halfway or full to the top? The Real Gross Domestic Product (GDP) increased by +2.1% in 2022 compared with the 2021 increase of +5.9%. The GDP numbers are a lagging economic Indicator. Why? Because those numbers show what happened in 2022 and 2021 and are not indicative of what is happening now in 2023. The unemployment insurance claims are very low. But the job market is also a lagging economic indicator because that is what took place last year. Retail sales were down in December after a decline in November. Major companies are cutting their workforce in most of the market sectors. The S&P 500 lost about 20% in 2022, and from what I read, many analysts believe the weight and pain of declining earnings have yet to be fully priced into the stock market. Why? Because those earnings decide much of how companies can and will spend money now and moving forward. The business news has had commentaries from many economists that believe a recession will arrive in the second quarter of 2023, and some believe in the latter part of the first quarter. Many believe the Federal Reserve will cause the recession because of their interest rate hikes and slowly winding down those rate increases. Much of the business news I see is opinionated. Switching station channels simply gets you another opinion. I call it business news entertainment!!!
The element of surprise in our financial markets is so elusive and powerful that even the most experienced and sophisticated advisors and market players are often caught off guard at different times. If only we had a crystal ball to gaze into the future and know what the markets will do. If we could only we could do what the famed inventor and owner of Ronco, Ron Popeil used to say, just “Set it and forget it .” Wow!!!! Would not that be great!!!
This is why I used Fixed and Fixed Indexed Annuities exclusively for all my clients. There are normally one or more Indexes and several strategies within each annuity that you can pick from and: “Set it and Forget it” if that is what you want to do and not change strategies every one to two years. After experiencing a few years of their annuity contract, many retirees decide a phone with me is all they want rather than an in-person meeting. They have other things on their mind. They are enjoying the peace of mind of not worrying about any losses from market downturns because there are none with Fixed or Fixed Indexed Annuities (FIA’s). Peace of Mind is what people want, especially in these times of uncertainty.