The New Year began inauspiciously, with global equity and bond markets falling in unison. Commodities proved to be a diversifier, benefiting from strong price gains, particularly in energy. The market downturn was driven by signs that major central banks are poised to reverse the monetary stimulus that has supported the global economy and capital markets during the coronavirus pandemic. Political tensions between the U.S. and Russia and rising Omicron rates in some countries also weighed on investors. While economic growth and corporate earnings surpassed expectations in 2021, rising inflation and interest rates, ongoing supply shortages, and an antagonistic geopolitical environment portend a more difficult year ahead.