The Week Ahead: An awful investing year comes to an end

A new year's worth of investing begins in one week. Anyone can make predictions, but long-term investors know it's not prophecy that leads to profits. The forecast was for a 10 percent increase for the S&P 500 stock index. Inflation fears, recession worries and a war in Europe have led to the worst year since 2008 when the Great Recession gripped the economy. This year is on track to be one of the five worst years for the S&P 500 since the end of World War II. According to FactSet's John Butters, 13 percent. That's the aggregate expected rally from stock analysts. If it holds, that would be a better than usual historical return for shareholders. But that's a big if. The Federal Reserve remains forthright in its resolution to fight inflation. The housing market will remain under pressure from higher borrowing costs. And Russia remains defiant in its war against Ukraine. Analysts are most optimistic for energy and technology stocks in 2023. One of those sectors -- technology -- is beaten and bruised this year. The other was a shining bright spot in an otherwise dismal investing year. The consumer staples sector holds the most worry as a new year dawns, which makes sense if one is in the 'how deep and how long will the recession be?' After all, the financial-industrial complex, like the fitness or diet industries, relies on selling a forecast of a brighter tomorrow. They know successful portfolios must be a balanced diet of risk and reward. Tom Hudson is a financial journalist and chief content officer at WAMU public radio in Washington, D.C. Follow him on Twitter URL. Featured Realtor