Stocks and Bonds are facing a Period of Stagnation, thus causing Impatience


During the last couple of days, numerous debates have been carried out regarding what people should invest in, as not many niches are that promising anymore. In fact, certain reports indicate that at this moment in time, both bonds and stocks aren’t really going anywhere, which can cause big trouble for investors throughout the world.

Recent studies have shown that there are currently around $12.2 trillion USD, which are being held in cash-based bank accounts in the United States alone. This sum represents a record level, yet, unfortunately, most of the people who have made deposits aren’t earning interest, and are also being affected by the continuous inflation. At the same time, bonds also offer a much smaller return, as currently, the 10-year Treasury bond offers only 1.7% in annual interest. As inflation is also situated around the same number, there’s practically no profit being made.

Not only this, but stock investments have also stalled a bit. While in 2016, the S&P 500 managed to close at 2058, next year, it closed at 2043.9, considerably lower.

For investors throughout the world, facing months and even years of low or even no return on investments is quite frustrating, which is why investors are looking towards other markets.

However, there’s also a good share of good news, as economic analysts have reported that this period of low-return and stagnation on the market will end soon. Analysts believe that the S&P 500 earnings will rise be around 13% in the next year. While impatience alimented by frustration are common emotions of this period of stagnation, patience is key in this market.

In the meantime, investors can consider looking for other niches to bet their money on. Margin trading, lending, and even forex have proven to be quite successful, given the numerous price fluctuations that the market has seen in the last couple of months.