WOW! What a year.
We all thought 2020 was one out of the box but it turns out that 2021 was quite possibly worse; having endured a very long (in my view as a Sydney resident) lockdown, I can certainly empathise with everyone in Victoria who had to put up with a much longer period indoors over the course of the year, with seemingly more restrictive conditions on exercise etc.
With the ASX200 now up 52% from its Covid bottom on 20 March 2020, we expect 2022 to bring increased volatility to markets as Government and Central Banks attempt to navigate large debt burdens with increased inflationary pressures. We have already seen rumblings of this nature in the US, as inflationary data hits a 40 year high and the market starts to price in multiple interest rate hikes. Domestically the RBA has continued to hold firm on not raising Rates until Inflation coincides with sustained wage growth. Overall, we expect the markets to perform in line with long term averages i.e. 6.5% – 7.5%. p.a., but with a little more bounce and pop than usual.
In the financial services space we continue to welcome incoming legislation as a follow-on from the Royal Commission; whilst Genesis believes this is necessary to continue to improve the professionalism of the industry, it is difficult to see how some will actually be of benefit to the consumer; all it seems to do is drive up costs. For example the newly introduced Design & Distribution Obligations (DDO) which was aimed at the product providers but has landed on the adviser’s plate to take responsibility for.
Also, mixed messaging from both political parties as we head to an election makes life at the coalface rather interesting.
Putting all that aside, I would like to thank all our clients who have supported Genesis over the years and continue to do so; in this last year on the insurance side, amongst other responsibilities, we have managed payment of over 15 Trauma (Critical Illness) claims, 2 TPD claims and 2 Terminal Illness claims. Whilst it’s never a very nice situation that occasions a claim, it’s a great feeling when you can ring a client and say literally “the money is in the bank!”. Everyone who works at Genesis deserves a big thank you from Wilton & myself for their efforts over this last year and I’m sure many clients feel the same way.
I hope everyone has a great Christmas with family and friends and 2022 delivers everything that you have asked for. From all of us at Genesis, please stay well, stay safe and have a very enjoyable break.
Phil Robbins, Managing Director
This information is general advice only and does not take into account your personal circumstances, goals and objectives. Therefore, you should consider its appropriateness for your circumstances before acting on this information.