Photo of Ray Ferrara CFP Ray Ferrara CFP Jan 03, 2022


What a boring year we had economically, politically, medically, and socially. We’re kidding, of course. The year started with almost everyone wearing a mask, tens of thousands infected by COVID-19, and thousands dying each day. But there was hope as the Pfizer and Moderna vaccines announced in November were starting to be distributed. Claims of Presidential election fraud were still in the air even though Joe Biden had been declared the winner.


January 6th was a dark day in American history when a rally for President Trump became an insurrection as many of the protesters stormed the Capitol, disrupting the official certification of the election results.  Five died and many were injured.  It was the first time there was not a peaceful transition of power in the U.S. January culminated with the inauguration of President Biden and with the Democrats in control of the House and an equally divided Senate but with Vice President Kamala Harris holding the tie-breaking vote. Investors looked for big spending and higher taxes. Oh, yes, Alabama won another NCAA football championship. 


February saw the Tampa Bay Buccaneers win the Super Bowl with Tom Brady at quarterback.  President Trump was impeached and acquitted for the second time.  Johnson and Johnson gained emergency use of the single-shot vaccine for COVID-19.  Come March, the House and Senate passed President Biden’s $1.9 trillion American Rescue Plan. There are floods in Hawaii, a blizzard that set snow records across the Western Range, and a tornado that killed five in Alabama. 


With the arrival of Spring, there is hope in the air that COVID may soon be under control as over 50% of the American population received at least one vaccine shot.  In an address before Congress, President Biden introduces the $4 trillion Build Back Better bill for jobs, social issues, and climate change.  With the April showers behind us, May saw the Colonial Pipeline hacked, disrupting the movement of oil and gas, causing prices to spike.  Some of the first signs of inflation started to emerge as the economies in the U.S. and around the world began to rebound from the pandemic. Still, inflation was estimated to be transitory by most policymakers. It also became apparent that a supply chain crisis existed as demand returned. May also brought the delta variant of COVID to the U.S., which devastated India in late 2020.


As summer approached in June, the first Alzheimer’s drug in 20 years was approved for use bringing hope to many. The G-7 agreed to a 15% minimum global corporate tax rate. July saw the world surpass four million deaths from COVID, wildfires in Canada, and floods in Europe.  The Tampa Bay Lightning won the Stanley Cup in a repeat of 2020, and the Milwaukee Bucks won the NBA Championship.  July also shined with Japan hosting the Summer Olympics despite COVID.  August brought fires to Greece, hurricanes to the U.S., and an earthquake in Haiti as natural disasters mounted throughout the year. At the end of August, there was the inglorious U.S. withdrawal from Afghanistan.


In September, El Salvador became the first country to recognize Bitcoin as its official currency, and North Korea fired two ballistic missiles that fell just outside the territorial waters of Japan.  October saw the World Health Organization endorse the first malaria vaccine.  Yes, there are other viruses to consider beyond COVID. By early November, five million had died from COVID and by late November the omicron variant was identified in South Africa.  The year wrapped up with the U.S. announcing a diplomatic boycott of the Winter Olympics in China.  Canada, the United Kingdom, and Australia soon followed.  The holidays were marred by Omicron, but on December 31 at the stroke of midnight, the world turned to 2022, and once again new hope for a better world emerged.

In spite of all of this, the S&P 500 increased 28.71% during 2021, the Russell 2000 was up 14.82%, the MSCI EAFE was up 11.26%, and the U.S. Aggregate Bond Index was down 1.54%. The rebound from the 2020 year of COVID was the primary driver of the economy and the markets. However, this outperformance was not without a fair degree of volatility. But at the end of the year, the bears were badly beaten up by the bulls. Growth outperformed value once again, but not nearly as much as it did the two previous years. Large-cap companies outperformed small-cap and international equities were beaten by companies in the U.S.


So, what does the year ahead portend? It appears that the Build Back Better bill will come before the Senate for a vote in early January, but it is DOA as Senator Joe Manchin played the grinch just before Christmas and said he was unable to support the bill.  Without his vote, Vice President Harris will not get a chance to cast the deciding vote as was hoped by the White House. Will it get reworked? Probably…but by the time it goes through all the committees and becomes satisfactory to moderate Democrats, it may be unacceptable to the party’s progressive wing. Even then, Congress will not spend the whole year working as they will head home in late summer for a final campaign push for the mid-term elections in November. At this point, it doesn’t look good for the Democrats as people vote for their safety (think a response to COVID) and their pocketbook (think inflation). However, it is a long way from here to November and much can change. One thing Congress must do early in the year is to allow for continued government funding by mid to late February.


The word “transitory” was used by Federal Reserve Chairman Jerome Powell and many others when discussing inflation in 2021; at least until the end of the year when the word was removed from Fed speak after October produced a 6.2% year over year increase in the CPI. This was followed by a 6.3% rise in November.  Energy prices were a big driver, as fuel cost 50% more than November 2020, which was before vaccines were available and very few people were traveling. Used automotive vehicles increased a whopping 42%. Residential real estate prices soared early in the year, and rents across the country skyrocketed over 20% in most places. Unfortunately, wage increases, while high by historical standards, were only up about 4.5%. The supply chain was a mess through most of the year, but there are signs of it easing during the first half of 2022 which should help minimize price increases. While we don’t expect energy prices to decrease, they should moderate, and the price of used cars should come back to earth along with other items. This could cause some to talk about deflation, which we don’t see next year. Inflation should be in the 3-4% range.


About 70% of the GDP of the U.S. is a result of consumer spending. It seems that the consumer didn’t mind spending during the holiday season as both the retail and online sales may have set records. We will continue to watch both first-time unemployment reports, which are at record lows, and we want to see them stay under 250,000 on the four-week moving average. There are 11 million open jobs (another record) and 7 million unemployed of which 4 million were employed pre-pandemic. In short, we should continue to see more come back into the workforce as the government money and unemployment checks are running out for many. If we continue to employ people, they will spend the money they make, which in turn should help drive the economy higher. Some dynamics could cause disruption. As the Baby Boomers retire, it will make room for everyone to move up, but that assumes everyone wants to move up.  The “Great Resignation” is the phenomenon that manifested itself this year.  People are quitting jobs before they find a new one. This could be another disruptor that will reduce productivity and then profits. 


The Fed will be even a bigger force than usual as it deals with the two “T’s” – taper and tightening. They have already announced the taper factor, which will end the bond-buying by the end of March. We would be surprised if the 10-year Treasury doesn’t increase to at least 2% within the first few quarters of 2022 and maybe finish the year close to 2.5%. The concern here is simple.  If the Fed starts tightening interest rates later this year and long rates don’t go up, the yield curve will become inverted. Every recession has been preceded by an inverted yield curve, but not every inverted yield curve has produced a recession. The Fed will raise interest rates probably two times if inflation slows down, but at least three times if it doesn’t.  Even then, by historical terms, it will still be easy money, just not as easy as it has been since the pandemic started. Higher rates will increase the cost of borrowing at all levels and reduce the purchasing power of the consumer.


The economy grew in 2021 by 5.5-6.0% and 2022 will likely be very good, but less than 2021. GDP growth in 2022 is estimated to range from 3.5% to 4.5%. If so, corporate earnings growth will likely be above 10% and could approach 15% if everything falls in line. The market closed the year with a price-to-earnings ratio of about 21x, which, fortunately, is down from its high of 24x back in January 2021.  This was a result of the fantastic earnings from companies last year.  Still, the ratio is about 28% higher than the traditional average of 16-17x. If earnings grow at an expected 11% rate in 2022, the p/e ratio would shrink to about 19x, all other things equal. This is better but still high. As interest rates rise it is harder to justify a p/e ratio at this level. Thus, a modest but positive return of 6-8% is the best we can project. It should be a decent, yet volatile, year which will likely post a 10% correction somewhere along the line.


If you have any concerns or questions, please do not hesitate to reach out to us.  We want to thank you for your continued confidence in our ability to assist you with your financial planning and investment management.  HAPPY NEW YEAR!



In November, the Federal government introduced the new I Bond with an attractive 7.12% interest rate, at least until May. The base rate on the I Bond is 0% but it adds an inflation rate to the interest rate paid and it is adjusted every six months. Thus, the I Bond is paying 7.12% today and will likely be adjusted downward (but still pretty high by comparison) for the next six months. Now for the other side of the coin. You must invest electronically and the maximum you can purchase is $10,000. You can purchase another $5,000 in paper form, but only with your tax refund. You can’t redeem the bond for the first 12 months after purchase, and if you redeem it within five years you lose three months’ worth of interest. Still interested? Actually, why not? If interested go to


By many accounts, 1,000 people are moving to Florida each day.  While many are coming to take advantage of the growing job opportunities, most are finding their way to Florida for retirement. But according to WalletHub, not every place in Florida is a good place to live in retirement. They surveyed 120 places for three key areas: quality of life, healthcare, and activities. They used 100 points for each. Here are the bottom 10 with their total score:


10) Plant City – 36.43

 9) The Villages – 36.18

 8) Land O’Lakes – 36.14

 7) Deltona – 35.13

 6) Navarre – 34.82

 5) Wesley Chapel – 34.81

 4) Town ‘n’ Country – 34.69

 3) Brandon – 34.54

 2) St. Cloud – 34.32

 1) Riverview – 33.3


We get a few of these but take exception to a few as well.



Among our many lists over the years, we have listed the best places worldwide for U.S. ex-pats to retire. This list includes the 10 worst places to retire, according to InterNations Expat Insider 2021 study. The study included about 12,500 ex-pats living in 174 countries/territories on many aspects of living abroad. Here are the bottom ten:

10) Malta

 9) India

 8) Turkey

 7) Cyprus

 6) Japan

 5) Egypt

 4) Russia

 3) South Africa

 2) Italy

 1) Kuwait


Makes you wonder why those that are living in these places continue to live there… doesn’t it?



ProVise Management Group named Eric Ebbert, CFP®, MBA as Chief Executive Officer, effective immediately, replacing Ray Ferrara, CFP® who is the founder. Ray will remain as Executive Chair and Chief Compliance Officer. Succeeding Eric as President is Jon Brethauer, CFP®, AIF®, CPFA, MBA.

Eric joined ProVise in 2000 and was named President seven years ago. “I look forward to setting the stage for our future growth as we approach $2 billion in assets under management,” said Ebbert. “We have a great team and it will continue to grow in both our Clearwater and Tampa offices.”

Jon has been Executive Vice President for the past three years and oversees the Retirement Plan Division of ProVise, which serves over 1,500 participants with almost $200 million invested. “We have come a long way in a short 35 years to become one of the leading financial planning firms in Tampa Bay and it is an honor to help move us forward,” Brethauer said. 

Shane O’Hara, CFP®, who joined ProVise seven years ago, was also named Executive Vice President. He stated, “I am proud of being able to help so many people at a fiduciary standard of care, especially those in the medical field.”