--- title: Investment Year in Review 2014 description: 2014 was marked by increased volatility and renewed concerns about global economic growth prospects. John Gullo covers it all in his Year in Review. image: https://insights.sandersonllc.com/hubfs/Imported_Blog_Media/2014YIR-image-motionblur-88166515.jpg --- - [716.566.2420](tel:716-566-2420) - [Client Login](https://www.sandersonllc.com/client-login/) [![Sanderson Wealth Management](https://insights.sandersonllc.com/hubfs/Sanderson_October2019%20Theme/Images/sanderson-logo-stacked@2x.png)](https://www.sandersonllc.com/) - About - [Services](https://www.sandersonllc.com/services/) - [Our Team](https://www.sandersonllc.com/team/) - [John Sanderson](https://www.sandersonllc.com/team/john-sanderson/) - [Justin Sanderson](https://www.sandersonllc.com/team/justin-sanderson/) - [James Warner](https://www.sandersonllc.com/team/james-warner/) - [C. Michael Bader](https://www.sandersonllc.com/team/mike-bader/) - [Caleb Jennings](https://www.sandersonllc.com/team/caleb-jennings/) - [John Gullo](https://www.sandersonllc.com/team/john-gullo/) - [Timothy Domino](https://www.sandersonllc.com/team/timothy-domino/) - [Debbie Todaro](https://www.sandersonllc.com/team/debbie-todaro/) - [Karen Nicpon](https://www.sandersonllc.com/team/karen-nicpon/) - [Joe Bartelo](https://www.sandersonllc.com/team/joe-bartelo/) - [Phil Frattali](https://www.sandersonllc.com/team/phil-frattali/) - [Evan Kraft](https://www.sandersonllc.com/team/evan-kraft/) - [Tucker Weppner](https://www.sandersonllc.com/team/tucker-weppner/) - [Angelo Goodenough](https://www.sandersonllc.com/team/angelo-goodenough/) - [Regyna Taberski](https://www.sandersonllc.com/team/regyna-taberski/) - [Eric Weiher](https://www.sandersonllc.com/team/eric-weiher/) - [Cameron Radziwon](https://www.sandersonllc.com/team/cameron-radziwon/) - [Donna Schmitt](https://www.sandersonllc.com/team/donna-schmitt/) - [Amanda Melendez](https://www.sandersonllc.com/team/amanda-melendez/) - [History](https://www.sandersonllc.com/history/) - [Mission and Values](https://www.sandersonllc.com/mission-and-values/) - [Services](https://www.sandersonllc.com/services/) - [Private Wealth Advisers](https://www.sandersonllc.com/private-wealth-advisors/) - [Investment Consulting](https://www.sandersonllc.com/investment-consulting/) - [Financial Planning](https://www.sandersonllc.com/financial-planning/) - [Estate & Generational Wealth Planning](https://www.sandersonllc.com/estate-generational-wealth-planning/) - [Business Succession Planning](https://www.sandersonllc.com/business-succession-planning/) - [Philanthropy](https://www.sandersonllc.com/philanthropy/) - [Tax Consulting](https://www.sandersonllc.com/tax-consulting-2/) - [Prosper Financial Wellness](https://www.sandersonllc.com/prosper/) - Insights - [Market Snapshot](https://www.sandersonllc.com/current-market-snapshot/) - [Sanderson Insights](https://insights.sandersonllc.com/) - [Contact Us](https://www.sandersonllc.com/contact-us/) - [Careers](https://www.sandersonllc.com/careers/) # Investment Year in Review 2014 by [John Gullo, MBA, CFA, CFP®, CIMA®](https://insights.sandersonllc.com/author/john-gullo-mba-cfa-cfp-cima) Jan 20, 2015 [Investment Consulting](https://insights.sandersonllc.com/tag/investment-consulting) Market volatility increased sharply early in the fourth quarter amid renewed concerns about deteriorating global economic growth prospects. These concerns were then highlighted when the International Monetary Fund downgraded its outlook for global economic growth, citing persistent weakness in the Eurozone and a broad slowdown in several major emerging markets. Sentiment, however, quickly turned following comments on October 16 from the Federal Reserve’s James Bullard who indicated that monetary easing from the Federal Reserve may continue beyond October. This interesting turn of events made it clear that central bank activity is still a major factor in stock price appreciation. ## Major asset class returns. |   | Q4 | 2014 | | --- | --- | --- | | Core Bonds | 1.8% | 6.0% | | U.S. Dollar Index | 5.0% | 11.7% | | Global Stocks (as a whole) | 0.4% | 4.2% | | U.S. Large Stocks | 4.9% | 13.7% | | U.S. Mid Stocks | 6.3% | 9.8% | | U.S. Small Stocks | 9.8% | 5.8% | | Foreign Developed Stocks | -3.6% | -4.9% | | Emerging Market Stocks | -4.5% | -2.2% | | Commodities | -12.1% | -17.0% | | Real Estate | 10.2% | 20.4% | ## Interest rates domestically and abroad. In contrast to the rising domestic interest rates that led to losses for most bond investors in 2013, falling interest rates led to gains in 2014. During the two-year period, returns differed substantially depending on term structure of the bonds held. Short term bond returns were .3% and 1.7% for 2013 and 2014, while longer term bonds experienced returns of -8.6% and 17.7% respectively. In addition to the U.S., foreign interest rates fell substantially in the developed world partially due to a combination of low levels of inflation and continued monetary easing from central banks. Noteworthy examples include Germany and Japan where 10-year government bond yields fell from 1.94% to .54% and from .74% to .37%, respectively. ## Labor market update. The pace of job growth accelerated during 2014 to nearly 250,000 new jobs per month. In total, the U.S. economy has now added more than 10.6 million jobs since the beginning of 2010, far outpacing the jobs lost during the 2008 to 2009 timeframe. In addition, the unemployment rate has fallen from 10% in October of 2009 to the current level of 5.6%. While monthly job gains and unemployment statistics were positive in 2014, there are other aspects of the labor market that are less than ideal. Today, only 62.7 out of every 100 potential workers are employed or looking for a job, down from 67.3 at the turn of the century. As such, a smaller percentage of the population is responsible for growing the economy than just a few short years ago. Also, wages, when adjusted for inflation, have changed little in the past 10 years making it difficult for the average worker to get ahead. ## Central bank activity. While the U.S. Federal Reserve concluded its asset purchase program in October and is now contemplating an interest rate hike in 2015, the European and Japanese Central Banks are moving in the opposite direction. The Bank of Japan continues to aggressively purchase bonds and the European Central Bank is now just beginning the process. These unprecedented programs, which are designed to help lower interest rates and spur economic growth, have led to combined central bank balance sheets that now exceed $10 trillion. ## Oil production and prices. The latest estimates indicate that domestic oil production has increased more than 20% in the past few years. With demand for oil relatively unchanged, prices began to adjust to the supply and demand imbalance in the second half of 2014. Oil fell from $115 in June to $55 at year end. The price decline accelerated in the fourth quarter when OPEC members failed to reach an agreement to cut production and Saudi Arabia reiterated its intention to keep producing at current levels. While the developed world as a whole will likely benefit from reduced energy costs, the benefits are mixed for the U.S. Over the past few years the domestic oil boom has been a significant contributor to job creation as well as economic growth and will likely suffer from reduced oil prices.   ## Disclosure This publication contains general information that is not suitable for everyone. All material presented is compiled from sources believed to be reliable. Accuracy, however, cannot be guaranteed. Further, the information contained herein should not be construed as personalized investment advice. There is no guarantee that the views and opinions expressed in this publication will come to pass. Past performance may not be indicative of future results. All investments contain risk and may lose value. © October 2019 JSG ### Let’s talk about your future. Schedule a consultation to learn more about our investment services. ## Filter Blog Posts ### SUBJECT - [Investment Consulting (166)](https://insights.sandersonllc.com/tag/investment-consulting) - [Financial Planning (150)](https://insights.sandersonllc.com/tag/financial-planning) - [Tax Consulting (44)](https://insights.sandersonllc.com/tag/tax-consulting) - [Estate & Generational Wealth Planning (15)](https://insights.sandersonllc.com/tag/estate-generational-wealth-planning) - [Firm News (11)](https://insights.sandersonllc.com/tag/firm-news) - [Lessons Earned (11)](https://insights.sandersonllc.com/tag/lessons-earned) - [COVID-19: Market Watch (10)](https://insights.sandersonllc.com/tag/covid-19-market-watch) - [Community (5)](https://insights.sandersonllc.com/tag/community) - [Philanthropy (4)](https://insights.sandersonllc.com/tag/philanthropy) - [Business Succession Planning (3)](https://insights.sandersonllc.com/tag/business-succession-planning) - [Prosper Financial Wellness (3)](https://insights.sandersonllc.com/tag/prosper-financial-wellness) - [Ukraine: Market Watch (1)](https://insights.sandersonllc.com/tag/ukraine-market-watch) See all ### AUTHOR - [Angelo Goodenough](https://insights.sandersonllc.com/author/angelo-goodenough) - [C. Michael Bader, Esq., MBA, CPA, CIMA®](https://insights.sandersonllc.com/author/c.-michael-bader-esq.-mba-cpa-cima) - [Caleb Jennings, MBA, CFP®, CIMA®, AIF®](https://insights.sandersonllc.com/author/caleb-jennings-mba-cfp-cima-aif) - [Cameron Radziwon, LSSBB](https://insights.sandersonllc.com/author/cameron-radziwon) - [Debbie Todaro](https://insights.sandersonllc.com/author/debbie-todaro) - [Evan Kraft, CFP®, CRPC®](https://insights.sandersonllc.com/author/evan-kraft-cfp-crpc) - [James Warner, MBA, CPA, CFP®, CIMA®](https://insights.sandersonllc.com/author/jim-warner-mba-cpa-cfp-cima) - [Joe Bartelo, CPA](https://insights.sandersonllc.com/author/joe-bartelo-cpa) - [John Gullo, MBA, CFA, CFP®, CIMA®](https://insights.sandersonllc.com/author/john-gullo-mba-cfa-cfp-cima) - [John Sanderson, CPA, CIMA®](https://insights.sandersonllc.com/author/john-sanderson-cpa-cima) - [Justin Sanderson, MBA, CFP®, CIMA®](https://insights.sandersonllc.com/author/justin-sanderson-mba-cfp-cima) - [Karen Nicpon, CPA](https://insights.sandersonllc.com/author/karen-nicpon-cpa) - [Phil Frattali, CFA](https://insights.sandersonllc.com/author/phil-frattali-cfa) - [Regyna Waterhouse](https://insights.sandersonllc.com/author/regyna-taberski) - [Sanderson Wealth Management](https://insights.sandersonllc.com/author/sanderson-wealth-management) - [Tim Domino, CPA, CFP®](https://insights.sandersonllc.com/author/tim-domino-cpa-cfp) - [Tucker Weppner, CFP®](https://insights.sandersonllc.com/author/tucker-weppner) ## Put our experience to work for your wealth. Schedule a consultation to learn more about our investment services. ## Background Schedule a consultation to learn more about our investment services. - [CONTACT](https://www.sandersonllc.com/contact-us/) - [CAREERS](https://www.sandersonllc.com/careers/) - DISCLOSURE - [COMPLIANCE](https://adviserinfo.sec.gov/firm/summary/118910) © 2022 Sanderson Wealth Management LLC [716.566.2420](tel:716.566.2420) Sanderson Wealth Management, LLC (“Sanderson Wealth”) is an SEC registered investment adviser located in Buffalo, New York. The publication of Sanderson Wealth’s website on the Internet should not be construed by any consumer or prospective client as Sanderson Wealth’s solicitation or attempt to effect transactions in securities, or the rendering of personalized investment advice over the Internet.  The information on this Internet site should not be construed as the provision of personalized individual advice from Sanderson Wealth. A copy of Sanderson Wealth’s current written disclosure statement as set forth on Form ADV discussing Sanderson Wealth’s business operations, services, and fees is available upon written request.  Sanderson Wealth does not make any representations as to the accuracy, timeliness, suitability or completeness of any information prepared by any unaffiliated third party, whether linked to or incorporated herein.  All such information is provided for convenience purposes and all users thereof should be guided accordingly. ACCESS TO THIS WEB SITE IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND WITHOUT ANY WARRANTIES, EXPRESSED OR IMPLIED, REGARDING THE ACCURACY, COMPLETENESS, TIMELINESS, OR RESULTS OBTAINED FROM ANY INFORMATION POSTED ON THIS WEB SITE OR ANY THIRD PARTY WEB SITE LINKED TO THIS WEB SITE. × ```json { "@context" : "https://schema.org", "@type" : "BlogPosting", "author" : { "@type" : "Person", "name" : "John Gullo, MBA, CFA, CFP®, CIMA®", "url" : "https://insights.sandersonllc.com/author/john-gullo-mba-cfa-cfp-cima" }, "dateModified" : "2020-06-17T13:28:04.899Z", "datePublished" : "2015-01-20T13:33:12.000Z", "headline" : "Investment Year in Review 2014", "image" : [ "https://insights.sandersonllc.com/hubfs/Imported_Blog_Media/2014YIR-image-motionblur-88166515.jpg" ], "mainEntityOfPage" : { "@id" : "https://insights.sandersonllc.com/investment-year-in-review-2014", "@type" : "WebPage" }, "publisher" : { "@type" : "Organization", "logo" : { "@type" : "ImageObject", "url" : "https://insights.sandersonllc.com/hubfs/Sanderson_October2019%20Theme/Images/sanderson-logo-stacked@2x.png" }, "name" : "Sanderson Wealth Management" } } ```