As we reach the end of 2021, it is a good time to assess the financial world and start to make our plans for 2022. There were a lot of concerns about how the tax code might change. It now appears that there will not be many big changes. The failed Build Back Better plan in Washington was where many of these changes would have happened.

The Federal Reserve Board told us almost all year that inflation was transitory even though rising wages, escalating real estate and other components of the economy told us otherwise. Finally, they admitted that they were wrong and announced an end to quantitative easing and the expectation of rising interest rates in 2022. Inflation hit a 30-year high. We have had many job openings that could not find workers, yet we received another stimulus check and had extra benefits for unemployment. The majority of Americans give Washington low scores on their handling of the economy.

It has been a crazy year in the stock market. There were many new, young investors who entered the stock market. They had higher personal savings because so many vacations, dining out and social activities were canceled due to the pandemic. This combined with stimulus checks, low interest rates, remote work and social media chatrooms led to some interesting events.

According to Tony Pasquariello, global head of hedge fund coverage for Goldman Sachs, “Following a year that saw more inflows than the prior 25 years combined, to what extent this cohort remains in the fight is a major open question for early 2022.”

We started the year with the meme craze. Stocks such as Game Stop and AMC movie theaters were hyped on social chatrooms. Young investors pour money in more as a game than market fundamentals. Game Stop was priced at a very low valuation because it had a business model that was probably outdated. Hedge funds had heavily shorted this stock because they believed the company had no where to go but down. As all the money flowed in from young investors, the hedge funds got into a short squeeze and had to buy back shares. This future increased the share price. Game Stop is up almost 716% for this year. That does not necessarily mean the valuation is correct in regards to profit potential.

We also discussed in this column earlier in the year a little deli in New Jersey that had an unbelievable market value of more than $100 million when their sales over the last two years were only $35,748! It has to make you wonder when the overall market is likely to end the year at new highs in spite of all the questions and the promised higher interest rates by the Fed. What a year it has been.

Now we must start planning for a new year. We will discuss some steps to take in next week’s column. For now, stay safe and enjoy a new opportunity to improve your financial future.

Your Financial Future is written by certified financial planner Gary W. Boatman, MBA and CFP, who also wrote the book, “Your Financial Compass: Safe Passage Through The Turbulent Waters of Taxes, Income Planning and Market Volatility.” If there is an area that you would like to see discussed in the column, send your suggestions to

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