With the recent volatility in the markets, Granite Group Advisors thought it would be prudent to share our thoughts on what is happening, and what you can do. While many of you may be interested in discussing the crazy happening in GameStop and Bitcoin etc.. we will focus on what we see going forward.
It is no secret that the equity markets are trading at records with lofty valuations. However, with the Federal Reserve continuing to provide liquidity, a new stimulus bill, keeping interest rates low, and other general government support, a case can be made that there will not be a 20% or greater market correction. Equity markets could experience a pullback of 10% or less which historically has been a part of norm.
We believe once the country gets through covid and the economy opens back up to travel, vacation and other restrictions lifted, people will have a lot of savings to spend. This is why GGA is optimistic on the equity markets for this year.
It is important however to watch the 10 year treasury yield because the higher it goes in yield the less this thesis will play out. As long as interest rates stay low things should go as expected. There may be some exogenous events as well that can cause ripples which is an unknown at this time but this is what we see as of today.
If you need or want any more clarification or just want to discuss this in more detail please do not hesitate to give us a call and set up some time to discuss your personal situation. Thanks for your time and attention and we hope you all stay safe healthy and prosperous !!!