Tip:
Highlight text to annotate it
X
GQ: Welcome to Monthly Market Talk. If the first two months of the year are any indication,
it's time to buckle up. January's losses were matched by February's gains. Now March roars
in like a lion. Between the weather, geo-political instability and monetary policy, things are
about to get very interesting. We bring in USAA's John Toohey to make sense of this.
John, are the first 2 months this year a precursor of what we can expect for the rest of the
year? JT: Gary, we definitely think so. The one
thing we're confident of in 2014 relative to 2013... it will be a much bumpier ride
in 2014. GQ: We had a conversation leading into this...
are we at a crossroads as far as the economy and the market are concerned?
JT: Certainly with regard to the market. With the economy, we don't know because of all
the cold weather. But with regard to the market, companies have done a great job of cutting
costs, improving productivity, reducing debt, buying back stock, reducing their tax rate.
What we haven't seen but we're looking for is organic revenue growth.
GQ: So they're doing everything they can within their span of control, but what about outside
of that span? JT: Well there are a lot of things you can't
control. One of them is political turmoil. And part of that is related to elections.
You're seeing a lot of elections coming up in many emerging market countries. India,
Indonesia, Turkey to name a few. We also have situations like turnover in Central Bank heads
in the US and India. We have congressional elections later this year. We still have Syria.
And now, we have the crisis in the Ukraine. GQ: Which is going to have a large impact
on maybe the petrol markets. And also, it's on the doorstep of the world's 2nd largest
economy. JT: Yeah, the Ukraine and Russia are big trading
partners of the European Union. Russia is a big producer of oil and natural gas. Anytime
there is a crisis or turmoil, prices of energy could go up. It's like sand in the gears of
the global economy. GQ: So everything seems to be coming from
different corners of the globe every time you turn around. So... gonna be a little more
turbulent. JT: Definitely in 2014. 2013 was that nice,
gradual climb up. Hoping to hit that cruising altitude this year. And I think what we're
running into is some turbulence. GQ: We seem to be bumping along the ceiling
with record highs or record drops it seems like every other day. What's an investor to
do in all this? JT: think most importantly, an investor needs
a plan, a long term plan and stick to it. If you don't have a plan, you need to see
an advisor. And in the meantime, remember that old adage, buy low sell high.
GQ: So rebalance time is a possibility? JT: Definitely remember to rebalance.
GQ: Thanks John. And remember, USAA is here to help make sense of the market with professionally
managed investment accounts and individual financial advice. Call us to speak with a
financial advisor or visit us online at usaa.com. Thanks for watching.