As children, we all enjoyed the occasional game of tug-of-war, and as 2011 concluded, we may have all felt as if we spent the year back on the playground. Although the year started on a solid note, it was not long before the wild swings in the market began. As we entered the summer months the volatility became even greater.
As we look back on 2011 it is important not to forget what we have lived through in just the short span of twelve months. One of the first big stories of the year was the deadly tsunami and nuclear meltdown in Japan, disrupting the global supply chain for everything from cell phones to automobiles. Then, not necessarily in chronological order, we experienced record snowfall, devastating tornados and floods, wars, riots, congress battling over the debt ceiling, the US debt downgrade, the supercommittee failing, protests, MF Global’s bankruptcy, a failed apocalypse, and probably most importantly, the European debt issue. As investors I think our perspective may be framed by either a “half-empty” or “half-full” view of the world. We personally look back at last year’s modest returns and declare it a victory.
With all of the various bearish and bullish predictions being made by market pundits these days, many of you might remember fall of 2010, when a high profile bond analyst called for “hundreds of billions of dollars” in municipal bond defaults in the coming year of 2011. That opinion, as well as a number of other factors, severely punished the municipal bond market in the fourth quarter of 2010, making that one of the worst three-month periods in the history of municipal bonds. We disagreed with this forecast. Any guess as to what was one of the best places to have invested in 2011? It was municipal bonds.
As we look forward into 2012 we believe that the tug-of-war game may continue. On the one hand you have a stock market that is trading at one of the cheapest valuations in decades, and on the other hand you have an almost daily news story out of Europe influencing the direction of the U.S. stock market. Don’t think there are no bright spots amongst all the doom and gloom! Much of the recent economic data has been encouraging. Unemployment claims are down to their lowest level in more than three years. Corporate America continues to be very healthy with earnings of the S&P 500 sitting at an all time high. Housing starts are up, pending home sales are now sitting at a 29-month high and certain parts of the county have started seeing local home prices moving higher. Even the consumer has been feeling a bit merrier, making this past holiday season one of the best on record for retailers. Lastly, some early reads on 4th quarter GDP look, quite frankly, pretty good.
Here at Raymond James things continue to be very good, despite the pain and suffering occurring with so many other financial organizations. As a firm we regained the number one spot in the annual SmartMoney broker survey. Our research department took the number two spot in the annual WSJ analysts’ survey. Awards were given for each individual analyst’s stock picking prowess. Over eighty firms were ranked in this survey. Just earlier this month Registered Rep magazine, for the second year in a row, ranked Raymond James as the number one major brokerage firm in the U.S. This was from a survey of advisors ranking their own firm in areas such as senior management, ethics, risk management, strategic focus, etc. With the conclusion of our firm’s 4th quarter and fiscal year (Sept. 30th) we were excited to see both record revenue and earnings reported, marking Raymond James' 96th consecutive profitable quarter. Again, we believe this is a testament to our firm’s conservative nature.
Going forward we are sure that new challenges will lie in front of us all. Please continue to visit this website for updates on timely investment and economic topics. As always, feel free to contact us directly if we can be of any further assistance.
Past performance may not be indicative of future results. SmartMoney does not sponsor, endorse, or approve the investment programs of Raymond James & Associates.
Past performance may not be indicative of future results. Registered Rep does not sponsor, endorse, or approve the investment programs of Raymond James & Associates.
Gross Domestic Product (GDP) is the annual total market value of all final goods and services produced domestically by the U.S.
The S&P 500 is an unmanaged index of 500 widely held securities. An index cannot be invested in directly.
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