From the desk of Willie Delwiche.
There is still one week to go before it ends, but Q1 2022 has been a remarkable quarter in many respects. If this year has taught us anything, it’s that a lot could change between now and when the closing bell rings next Thursday. But as it stands now, this will be the first down quarter for stocks since Q1 2020 and it will go down as the worst quarter for bonds in a very long time. Both stocks and bonds falling by more than just a marginal amount makes this a particularly forgettable quarter for investors in passive 60/40-type portfolios. There has been no place for them to hide. Not strength to offset weakness. Recent weak quarters for balanced portfolios saw strength in bonds offsetting weakness in stocks. Recent weak quarters for bonds have coincided with strength in stocks. The only somewhat similar experience in the past quarter century was Q3 2008 - bonds were down but only modestly. Two takeaways: First, this helps explain some of the dour mood among investors. Second, quarterly rebalancing this time around will have otherwise passive investors sell what has been weak (stocks) and buying what has been even weaker (bonds) because the consensus is that it is too risky to be in strength (commodities). 
