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This is a good (US) economy

Despite professional forecasters predicting a recession in early 2024, late last year, one of our senior analysts at Mazars, James Hunter Jones, insisted on adding a “Dream” scenario in our forecasts: one where the economy would perform well, and still inflation would drop. We did, and assigned an outlier probability to it.

Let’s see how James fared versus the world.

2024 market forecast

Given the stock and bond market volatility, it’s hard to know what the starting point for equity valuations and rates as we enter 2024. At the beginning of the year, we said that volatility and geopolitical uncertainty will persist. Stocks and bonds were nearly flat by the end of October and are now up 10% and 5% respectively in just thirty days.

The importance of long-term investing

Woman thinking about long term investing

Challenging market environments can create situations which can lead to some biased decision making. Recognising this will prevent investors from making decisions that could negatively impact their long-term investment performance.

How behavioural biases affect investment decisions

Woman looking out of window

The reason long-term investors like Warren Buffett can consistently earn profits and outperform is because of market inefficiencies. These inefficiencies are inevitable because markets are composed of human beings, who no matter how disciplined, will often make financial decisions that consist of behavioural biases causing them to act on emotion.