With the Christmas holidays almost upon us, predictions for the year 2017 are slowly surfacing all over the Internet. Especially those related to the financial sector are of interest, as people are now putting together a list of ‘unpopular investing choices”. Some intriguing predictions have arisen, including the lack of uptrends for the US stock market, interest rates, and a spectacularly increasing federal deficit.
Financial Predictions For 2017 Are Not Promising
People who have more than two years for a brain will acknowledge most economies barely scraped by in the year 2016. Although some regions have performed better than others, we are still a far cry away from recovery, or even economic growth on a large scale. Mainly the US economy will not see a significant change, which should have stock market traders concerned.
In fact, it seems highly unlikely the US stock market will see any increase at all. Over the course of 2017, a few percentages may be added, but spectacular gains are out of the question entirely. That leaves only two plausible results: stagnation or a decline. Depending on President Trump decides to handle things, that latter option could become a factor rather quickly.
The year 2016 has been somewhat positive for the US stock market, but that is not necessarily a good thing. Valuations ate an all-time high, and it is only a matter of time until the bubble bursts. The only upside is how US stocks remain them cost appealing option in the global stock market, but that is about as far as optimism for 2017 goes.
Interest rates have been a topic of substantial debate throughout 2016. It is expected the Federal Reserve will hike rates in the next week or so, even though that its anything bur certain. Central bankers are all about talk with very little action, and 2017 will be no different than other year in that regard. If there is no interest hike next week, things could get dicey very quickly.
Perhaps the biggest issue to not look forward to is how the federal deficit will evolve. Stimulus spending will not be paid for, in general, resulting in a larger federal deficit in the President Trump era. Not that the could do much about it, as there is little economic growth and no potential budget cuts even worth considering. Moreover, no significant tax reforms will take place, as political leaders- even when members of the same party – won’t see eye to eye on these important matters.
In the end, financial experts predict consumers will be better off than they were in 207. Quite an optimistic statement, considering all of the cards are pointing towards a future filled with financial struggles. People worried about the long-term perspective should look into diversifying assets and portfolios sooner rather than later. Never put all the eggs in one basket unless you want to make an omelet.
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