The Weekly Update 12/05/2025™
Just a few weeks ago in the piece I wrote as The Weekly Update for 11-21-2025, I presented the level of fear (negative outlook) in the Fear Greed Index was near the most extreme level (Read it Here).
Like it or not, the inevitable pockets of volatility will scare a large part of investors out of their investments, and investment plans, for many years into the future.
Yet, today we rest at valuations for Corporate America, as measured by the S&P 500, near all-time highs! It is very important to remember that the cost of investing is …volatility. “Always” has been “always” will be! Volatility is a constant.
Those fear levels noted in the Weekly Update above on 11-21-2025 were during a very normal 5% pullback, reduction, back and fill, dip, etc. Call it what you choose, but volatility causes angst and fear.
In the not-too-distant future, like perhaps just five or six years from now the Dow Jones Industrial Average (DJIA) could make its’ way to 100,000. Just a guess on my part but when your favorite news channel reports a negative piece and we see a 10% to 15% correction, as in down 10,000 or 15,000 + points, the investment crowd will likely pass out.
The vast majority of investors have no concept of the dynamic opportunity happening right now in our economy, not to mention the paradigm shifts well under way as you read this.
Each of us should use any pockets of volatility to build our bigger financial future, not run from it. If I had to put the dynamic paradigm shifts bubbling up into a picture it would look like this!
As for the last few weeks of 2025, we will enter one of the more favorable parts of the year for investment returns. Our industry refers to this as “The Santa Claus Rally” and here are some, on average, historical December dates of interest going back to 1950.
If December 2025 is average, the valuations should start going up about now. My guess is this trend up that we have been in for the last three years will likely carry into 2026.
I did not say market valuations go straight up, and I did not say without volatility, yet the data flow suggests the good old USA has a very bright outlook. Think “Five Year Money” (Read it Here).
I’m interested in your thoughts, comments and observations. Feel welcome to call, email, or stop by the office and say Hi.
Respectfully,
James O. Lunney, CFP®
CERTIFIED FINANCIAL PLANNER™ Professional
*The economic forecasts set forth in this material may not develop as predicted and there can be no guarantee that strategies promoted will be successful. The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which investment(s) may be appropriate for you, consult your financial advisor prior to investing. Investing involves risk. Loss, including loss of principal, may occur. No strategy assures success or protects against loss. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.
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