West Michigan Stock Returns

It should surprise no one that stock returns for 2008 were horrible across most industries and regions. Stock prices mostly reflect two major factors: the ability of companies to earn money, and the degree of investor optimism. Both are in the toilet because of the double whammy of this past summer’s worldwide financial crisis and the development of a worldwide deep recession

West Michigan Stock Returns

West Michigan stocks have outperformed the national market indexes in 9 of the past 11 years, often by a considerable margin. That wasn’t the case, however, in 2004. Although West Michigan stock returns outperformed the Dow Jones Industrial Average, they trailed the two other major national market indexes

West Michigan Stock Returns

Investors certainly remember 2018’s miserable stock market performance: The major stock indices dropped nearly 15% in the fourth quarter, bottoming out on Christmas Eve day. That’s the bad news, however. The good news is that the bar was set low for 2019 to outperform 2018’s performance. Had stocks done nothing more than just recover from those losses, 2019 would have been a good year for investors. As we all know, and to the surprise of many, many investors who were prepared for a 2019 recession, stock markets shot up

West Michigan Stock Returns

The market performance of the West Michigan Stock Index is heavily dependent on the performance of two industries: banking and auto. Economic pressures were not kind to either of these two industries in 2006. The Federal Reserve continued to raise short-term interest rates even as Michigan’s economy remained in the doldrums. The higher rates eroded bank interest rate margins, reducing bank profitability. A reduction in mortgage lending fees — partly the result of the housing bubble bursting — also cut into bank profitability. The result has been intense competition among area banks, price cutting, slower growth, investor skepticism about the shortterm outlook for the banking sector, and the first bad year for local bank stocks in several years