Another Year of Surprises

The least surprising part of 2024 is that it was filled with surprises.  Let’s review some of the events that shaped the economic and market news this past year.

The stock price of the leading US chip manufacturer tripled during the year.  Nvidia’s market capitalization is now the second largest in the US behind Apple, representing 6.5% of the S&P 500 index.

The Federal Reserve lowered its interest rate three times in 2024, for a total drop of 1.0%.  The last reduction in December, the Fed lowered interest rates by 0.25%, which almost every analyst expected, and yet the S&P 500 fell almost 3% that same day.

The Assad regime, which had ruled in Syria for 50 years, suddenly and completely collapsed, and its leader, Bashar al-Assad, fled the country he led since the beginning of this century for Russia.

About 100 days before the election, the sitting US President was driven from his reelection campaign on the grounds of incapacity. 

The Presidential election was resoundingly won by a former president who had lost the election four years prior and was awaiting sentencing in a felony case.

There are plenty of other examples, but the lessons to be drawn from this are obvious.  The economy, markets, politics, and geopolitics are practically unpredictable.  If we let utterly random current events of any kind alter our investment policy, then we never really had an investment policy and are doomed as investors.  My only prediction for 2025 is that it will be filled with more unpredictable events.