Brad here. Today, we have another detailed look from one of our great investment analysts, Nicholas Follett. Just as with Anu’s take on emerging markets yesterday, Nick provides an in-depth discussion of one of the most popular asset classes out there—including why you might be interested and what you need to watch out for. He goes into a bit more detail than we normally do here, but consider this an example of what really goes on at Commonwealth as we dig deep for our clients and investors. Enjoy!

Brad here. As part of my Next World series on this blog, I have been discussing the themes and implications with Commonwealth analysts to try to determine what it will mean, over time, for how we invest. Anu Gaggar, our international analyst, put together this piece, which I think is worth sharing. Take it away, Anu!

Last week was a busy one on the economic front, with several reports on housing, a look at durable goods demand, and the consumer income and spending report. This week is a short one, due to the Christmas holiday, but there are a couple of economic reports worth paying attention to.

Of course, here I am riffing on the famous headline published after President Ford refused to bail out New York City (see below). Yesterday, there is no doubt that markets were expecting a bailout from the Fed—and threw a tantrum when they didn’t get it.

It’s that moment you’ve all been waiting for—the 2018 Bubble of the Year Award (“the Bubby”)! This long-standing tradition (as of last year) brings together the strongest and weakest investment stories for a no-holds-barred match to see which stands out as the bubble of the year. This year, we have several strong contestants.

Several weeks ago, an advisor asked me to take a deep look at debt in the economy. I thought this was a great idea, both timely and important. In fact, I meant to get to it sooner but, well, things happened. When I did start to investigate, I realized that “debt” was many different topics, deserving of several posts. So, here we are, beginning a series that will resume in January. Fortunately, the news is not actually all that bad in most areas. Even in the ones where it is very bad (e.g., U.S. government borrowing), there are reasons to, if not be cheerful, than at least not to despair.

Last week was a busy one on the economic front, starting with prices. This week will also be active, with several reports on housing, a look at durable goods demand, and the consumer income and spending report.

Market risks come in three flavors: recession risk, economic shock risk, and risks within the market itself. So, what do these risks look like for December? Let’s take a closer look at the numbers.

The good news is that confidence continued to be strong last month. Business sentiment remains close to a 21-year high, and consumer confidence remains very close to an 18-year high. Although job growth declined, it was after a very strong month, and it remained at healthy levels. Longer-term interest rates, which had been a concern after a spike, also moderated. Overall, the economic news remains solid, which should support continued growth.

What can we expect from the market in 2019? I discussed this and more on CNBC's Power Lunch today.