2023 Economic Outlook: ‘Slow and steady wins the race’
Posted on February 17, 2023
The Sanibel Captiva Trust Company’s Investment Management Team recently held their 2023 Economic Outlook events throughout Tampa Bay, Fort Myers and Naples that offered a global economic overview and investment strategies worth considering in the new year for clients and friends. Click here to watch the presentation.
At the Fort Myers event, Founder and Chairman S. Albert D. Hanser, along with Lee County Market President and Wealth Services Advisor Jeffrey A. Muddell, CFP, welcomed more than 100 attendees with a recap of 2022’s financial highlights, the company’s successes, as well as insight into what’s ahead for the economy in 2023.
“So much happened in 2022 – inflation and interest rates spiked, housing prices soared, stocks went up and down, cryptocurrencies collapsed, unemployment rates dropped, political tensions continued,” Hanser said. “For 2023, investors should keep medium- and long-term gains in mind. Slow and steady wins the race.”
The Sanibel Captiva Trust Company created the annual Economic Outlook to share exclusive insights and market knowledge with clients and potential clients who have at least $2 million in investible assets. The firm serves high net worth investors who rely on wealth management services to protect, grow and perpetuate their families’ assets.
Many investors question whether now is the time to sell and “cash in” in case the market dips. Advisors, however, caution against that strategy.
“You should not try to time the market,” said Gary W. Dyer, CFA, senior vice president and senior portfolio manager. That’s why it makes sense for many investors to purchase stocks in trusted, established brands and companies that have been industry leaders for generations. “You buy something for a longer return and let it grow,” Dyer said.
Edwin C. Ciskowski, CPA, senior vice president and senior portfolio manager, addressed one of the biggest economic issues of 2022 – inflation.
“We have more job openings than we have people willing to fill those jobs,” Ciskowski said. “It’s forcing companies to pay more for labor, and that’s driving inflation.”
Ciskowski noted job reports showing in excess of 10 million vacancies nationwide, which Craig. J. Holston, executive vice president and senior portfolio manager, noted reflects a mismatch between job skills of individuals in the labor pool with skills that businesses are requiring. Balancing the equation will require retraining of the workforce, an initiative that takes time to resolve.
Looking ahead to 2023, Holston is optimistic about the U.S. economy and stock market, and bonds should remain attractive because of elevated interest rates. Potential volatility in the market, Holston notes, should force investors to heed traditional valuation metrics and put their money into proven, long-lasting companies. That strategy is often a safer choice than investing in cryptocurrencies or tech startups, which can generate quick returns but also come with significant risk.
“You can’t value it,” Dyer said of some newer companies and cryptocurrencies. “You have no idea what it’s worth.”
Overall, stocks should see a steady climb for the next few years.
“More than likely, we’re going to do OK,” Holston said.
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