Market expectations for 2017 and beyond

2.  Where is it now?
 Where is the rest of the world?
 What are the odd’s you are wrong?
Where is the economy headed

3. Where are we now?
Employment

4. Where are we now?
Production

5. How about consumers?

6. How about income?
Average Hourly Earnings - YOY
Employment Cost Index - YOY

7. US Summary: Steady Growth

8.  First, let’s talk about China:
And the rest of the world?

9. And Europe – Looking up

10. And Europe – Looking up

11. And Europe – Looking up

12.  An 18-year Bull
 Then a 14-year Bear
 Then an 18-year Bull
 Then a 13-year Bear
 Now?
In General, We’re Constructive:

13. With this caveat: Valuation

14.  World stock markets:
But there are concerns: concentration

15. And mean-reversion

16. Recent returns (20 yrs)

17. Current Expected Returns:
Charter Trust Company 2017 Outlook
Average Error Average Error
Economy International:
GDP 2.5% ± 0.50% EAFE 7.6% ± 4.0%
Inflation 1.9% ± 0.50% UK 6.0% ± 6.0%
Fed Funds Rate 1.1% ± 0.50% Europe 5.3% ± 6.0%
Pac Rim 5.5% ± 6.0%
Domestic: Japan 4.3% ± 2.0%
S&P 500 8.4% ± 5.0% China 6.0% ± 10.0%
Mid Cap 9.7% ± 6.0% South Africa 5.5% ± 7.0%
Small Cap 10.3% ± 7.0%
Emerging
Markets 5.1% ± 10.0%
Brazil 5.8% ± 10.0%
Frontier Markets 5.0% ± 10.0%