Central bankers’ efforts to push investors back into riskier assets came on the heels of improved corporate earnings.
 
They managed to outperform during the third year of the European debt crisis, overshadow the slowest economic expansion in China in 13 years, and the inability of the US Congress to agree on a plan to avoid the fiscal cliff.
 
The massive easings restored confidence in investors that there would not be another recession.
 
The global economy expanded 2.2% in 2012, which also bolstered equity investment.
 
Profits of companies in the MSCI All-Country World Index rose 11%, not far from the record set in 2007.
 
Twenty-three out of 24 developed country benchmark indexes advanced during the year.
 
Spain’s was the only developed country index to post a loss.
 
Conversely, the S&P GSCI Total Return Index of commodities fell .6% in December, trimming its advance for the year.
 
Bank of America Merrill Lynch’s Global Broad Market Index that tracks about 20,000 fixed income securities was flat in December after a five-month advance.
 
The effects of various policy easings on the global economy will continue to play out over 2013 but we can make two positive observations: investor confidence overall seems to be improving and there are signs the US economic recovery will continue, even if it is slowed a bit by fiscal cliff-related issues.

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