Final thoughts for 2022

There’s a lot of good news for investors, if you manage to look clearly. We’ve come out of the pandemic in a heightened state of fear.

Many of us are constantly looking over our shoulder for the next bad news story to emerge. This is understandable and totally normal, the pandemic was a life changing period for many of us.

It is during our darkest moments that we must focus to see the light. -Aristotle

I’ve written about when and how to panic as an investor previously (If you must panic, panic early) There’s an art to it.

Most are only now starting to worry about inflation, when the time to panic was when rates were at zero and inflation was non-existent.

While it’s good to be paranoid as an investor, and always look out for fear, the problem with this approach is you can miss the good news right in front of you.

There’s a lot of good news going into 2023 — the jobs market across developed economies is extremely strong, central banks are on the ball when it comes to inflation and China is starting to open up from its lockdown phase.

The world’s largest economies are in the early days of a major recovery.

We have some amazing technology emerging. The AI revolution, combined with the shift to cleaner energy, could completely transform our day-to-day lives and improve economic productivity. Innovative is accelerating.

We can often get caught up in an echo chamber of bad news, and I think that’s the biggest risk for investors going into 2023. If you must panic, panic early.

Panic about missing the good news.

Interest rates are rising because the economy is strong. Rate rises will soften the economy, jobs are starting to be lost. But we’re coming off a very strong base.

I’m not blind to the risks, I’m just equally open to the opportunities.

Australia remains one of the world's most desirable investment destinations and the limited supply of new residential stock coming into the market means real estate investment is still a very attractive wealth creation strategy.

Don't get caught up in the negativity. Embrace the opportunities that lay ahead.

Merry Christmas, Happy New Year from all of us at Wealthi and we wish you a prosperous start to 2023.

Peter Esho is an economist and Co-Founder at Wealthi. He has 20 years of experience in investments and markets, publishing writing his weekly thoughts at peteresho.com