Last week we saw the yield curve invert once again in 2019, with yields on the 10-year treasury note dipping below those of the 2-year note.
Looking back, 2018 certainly felt like a roller coaster ride for investors. After a fantastic nine year run where US stocks returned an annualized 15.44%, you can see why 2018’s results came as a surprise for many. Coming off their 4th best year since 2000, domestic stocks, as measured by the Russell 3000, had their first calendar year decline since 2008. The volatility in the equity markets seemed unusual given recent data, but in many ways 2018 provided a return to historical normalcy that we hadn’t seen yet this decade.
While in 2018 US stocks have well outpaced international stocks, that is not always the case. Just last year international stocks outpaced US stocks by 6.4% and so far in the fourth quarter emerging markets have topped the US by 1.8%.