January 2016 Commentary

Despite gaining +2% in the final week, stocks closed down -5½% overall for the month of January. The slowdown in China and softness in the energy sector continued to weigh on the market. The Bank of Japan’s efforts to stimulate the Japanese economy and stronger US corporate profits helped boost the market.

It was another good month to be strategically allocated for what may come and although down, such portfolios avoided a good piece of the downside. If you would like to know exactly how your portfolio did relative to the broader stock market, please let me know, I am always happy to talk about your investments or financial planning.

Playing the Probabilities:

The odds of winning $1.5 billion in the recent Powerball were 1 in 292,000,000,000 or .00000000034%. The best odds of winning at a casino are substantially better but still negative at 49%. Stock ownership is not gambling and past performance is no guarantee of future results but even so the stock market’s track record is diametrically better.

The S&P 500 was up between 1926 and 2015:

– 54% of the days

– 68% of the quarters

– 74% of the years

– 86% of the lustra (five year periods)

– 94% of the decades

– 100% of the indictions (fifteen year periods)

Even for the fifteen-year period ending March, 2009 (which included the collapse of ’08 / ’09) the market still averaged +6.5% annually for each of the fifteen years.

Credit Card Rewards

Credit card rewards can be quite generous for those with good credit. Rewards can include cash back, airline travel credits or cash, and hotel & theme park discounts just to name a few. For those who pay their bill off in full each month, the rewards programs can be a tremendous perk.

Google maintains a comprehensive and searchable list of credit card details and rewards that can be found at:

www.google.com/compare/creditcard