- Gold bugs experienced a sharp 14% rally, gave it all back, saw another 14% rally, and then gave some of it back again. As inflation remained subdued, gold was more of a risk-on asset than a flight to safety asset class.
- Equities had a very strong year, but risk factors including European scares, worries about a Chinese slowdown, and concerns about austere US fiscal policy contributed to sharp sell offs within the year. The equity markets climbed a wall of worry.
- 30 year Treasuries traded inversely with equities because market participants saw deflation as the biggest threat to an economic recovery.
Whereas the individual asset classes were quite exciting, the overall Permanent Portfolio lived up to its promise of a slow boring upward drift. The PP returned 6.35% nominally and around 4.76% after adjusting for inflation (the inflation data for December isn't finalized yet). This year's performance is right in line with the PP's historical performance.