Friday Investment Talk: 2022 Forecast, Financial Repression, Santa Claus Rally

Economies are expected to continue to grown above average pace in 2022, as low interest rates and a rebound from COVID shutdowns continue. Advanced Economies have seen a huge run up in debt since 2001that has pushed US stock prices to all time highs, even during the COVID pandemic.

Cash levels among US investors remains high, while ‘Financial Repression’ remains a long term headache for investors. Emerging markets show strength as the USD weakens. Dividend paying stocks in emerging economies could see higher inflows in 2021.

Small cap stocks show weakness during the Santa Claus Rally, while large cap FAA(N)MG stocks hold the major indexes afloat. A more subdued January trading month can be expected after the bullish run from the November elections.