This time last year, my picture of 2015 was that:

–world economies in the aggregate were bottoming,

–early in 2015 the Fed would kick off the long journey of raising short-term interest rates from emergency-low levels toward normal (meaning 2%+)

–the first half of the year would be flat to down as world markets adjusted to the new interest rate regime and confirmed that global economic activity was no longer deteriorating, but

–late in the year there was a chance for a stock market rally as investors began to factor into stock prices their chance of better news coming in 2016.

My biggest worry last December was that stocks normally don’t go sideways for a long period.  They either go up or down.  If the market works out that the up direction is impossible–which I thought would be the case in early 2015–then short-term traders will invariably try to push the market down to see how low it goes before meeting resistance.  What I found most surprising was that the S&P 500 tread water for over seven months before beginning its August-September swoon.

As events turned out, the Fed delayed raising rates until December and emerging markets were hit by a deeper fall in mining commodity prices than I’d anticipated.

One result of that is that stocks are flat for the year vs. my expectation of a positive, but sub-10% gain.

Another is that I think we’re basically in the same position today as I envisioned we were a year ago–and should anticipate a flattish first half for 2016 followed by an uptick sometime in the second.

While this view placed me in the relatively cautious camp last December it places me among the bulls today.

More tomorrow.