Just looking back at how 2021 wrapped up for the stock market - it was actually a pretty solid year overall, even though things ended on a soft note. The final trading day saw the major indices dip slightly, but if you zoom out and look at the full year, the stock market performed way better than that last-day weakness would suggest. We're talking Dow up nearly 19%, S&P 500 gaining almost 27%, and Nasdaq climbing over 21%. Pretty decent returns when you think about it.

What really caught my attention was why bonds got crushed so badly. I mean, Treasury yields started creeping up mid-year, especially in that 5-10 year range where things moved the most. Ten-year yields jumped from under 1% to 1.5%, and five-year yields nearly quadrupled. For anyone holding bond ETFs, that translated into real losses - even the shorter-term Treasury funds dropped 2-3%. That's the thing about bonds people forget: they're not risk-free, especially when rates start rising.

The other major shift I noticed was this huge rotation out of the pandemic winners. Zoom and those high-growth tech names that absolutely dominated 2020 started rolling over once vaccines hit and people got hopeful about things normalizing. Meanwhile, value stocks and cyclical sectors that had been sleeping started waking up. It's wild how fast sentiment can flip in the stock market - what's hot one year suddenly looks overcooked the next.

Looking at 2021 in hindsight, it really came down to two things: bonds offering nothing attractive, so money kept flowing into equities, and this major shift in what types of companies investors wanted to own. Those were the real drivers behind why the stock market performed as well as it did that year. Makes you wonder what the next big rotation will be.