By: Andrew Rosen, CFP®, CEP®

We all know the saying, “those who cannot remember the past are condemned to repeat it.” Growing up, I never fancied myself a history buff. As a matter of fact, it probably was my least favorite subject in school. But when it comes to the markets, understanding the history is very important. It can only help us be equipped for the future.

I’d like to focus on how interesting the past year has been in the markets. The hope, quite honestly, is we’ll understand that this time isn’t any different from past events and we’ll be more financially astute moving forward.

My Time Machine

Let’s hop in my time machine phone booth (a la Bill & Ted) and go back to the beginning of 4th quarter last year. The markets were doing well. The S&P was up over 10% for the year and we were ready for a nice landing to end the year. I remember it well, as I was on a family vacation out of the country. I had thought “this is great, markets are at an all-time high. I can relax. What could go wrong?”

What indeed. A few Presidential tweets on China and we had one of the worst 4th quarters of all time. My vacation became stressful. A lot of chatter about the recession finally arriving emerged and the equity markets dropped nearly 20% in those three months alone. Undisciplined investors started to panic.

Bonds, on the other hand, were down all year at the start of the 4th quarter due to rising interest rates. It looked like we’d have only 4th down year in US bonds since 1976 and that was OK; stocks were up handsomely! But the 4th quarter had in store a rebound for bonds to slightly above break even for the year.

All of this happened in a relatively short period of time. Those that predicted a correction were finally vindicated, and those that didn’t, were rethinking. So, what happened from there?


No one thought after the 4th quarter of 2018 that the 1st quarter 2019 would look any different. Newspapers, radio, TV, clients, pundits, and analysts all spelled out a recessionary year for the US economy. Justifiable right?

This is where the story gets interesting. As soon as 2019 started, the markets did an about face. The Fed stopped raising rates and some more optimism about trade wars began. The first quarter 2019 was incredible. As a matter of fact, it was the best January in the S&P 500 since 1987!

Let me repeat that for effect. After one of the worst end of years in the stock market, the very next month was historically good! Interesting, right?

Present day

So where do we sit today? With less than a month to go in 2019, the global equity markets are up in the 20% range (hitting all-time highs) and bonds are up over 8% this year.

Isn’t that incredible? This is all despite what the naysayers thought would happen.

History lesson learned!

There’s an important lesson to be learned here–when it comes to investing, it’s imperative to detach emotions as much as possible. It’s also critical to look at the long term picture and not overreact. Trust me. I understand how hard these things are to do (heck, I have a job because of it). In good times, and in bad, having a cool head usually prevails.

What will 2020 have in store (holy macaroni, are we really 20 years past the turn of the millennium already)? My magic 8 ball suggests ask again later.

Let me ask it another question–will 2020 be riddled with uncertainty and thus individuals should do their best to remain grounded while putting things into perspective?

Magic 8 ball answer: Decidedly so!

In his role as Financial Planner, Andrew forges lifelong relationships with clients. He coaches them through all stages of life and guides them to better achieve their life goals. Andrew loves helping others by spreading his knowledge on finance, investments, and the pursuit of happiness/fulfillment. He writes nationally recognized, weekly blog posts on these topics and is a regular contributor to Kiplinger. Andrew has been published in The Wall Street Journal, Barron’s, Financial Advisor Magazine, US News & World Report, USA Today, CNBC, along with many other publications.

For more information or to book a consult with Andrew or the other firm partners, Kyle Hill and David Levy, click the link below.

Andrew Rosen, CFP®, CEP®
Kyle Hill, CFP®
David Levy, CFP®

 Financial planning and Investment advisory services offered through Diversified, LLC, a registered investment advisor. Securities offered through Securities Service Network, LLC, Member FINRASIPC. Some associates of Diversified, LLC are registered representatives of Securities Service Network, LLC, a registered broker/dealer, 9729 Cogdill Road, Knoxville, TN 37932. (800) 264-5499.