This message comes from a fellow financial planner, Cicily Maton of Aequus Wealth Management Resources. She graciously gave me permission to share it.
We have been watching the markets along with the rest of you and we can almost feel the anxiety and panic through the airwaves. There is little new information that is responsible for this current wave of selling. But it is very much like the emotional panic selling that has occurred in every other bear market. There is nothing much different that we can say to you to help ease the pain.
We do have a reminder checklist, however, courtesy of Davis Distributors, managers of Selected American Shares, “The Wisdom of Great Investors – Insights from Some of History’s Greatest Investment Minds.” The following points are well worth keeping in mind:
• Avoid Self-Destructive Investor Behavior
• Understand That Crises Are Inevitable
• Don’t Attempt to Time the Market
• Be Patient
• Don’t Let Emotions Guide Your Investment Decisions
• Recognize That Short-Term Underperformance Is Inevitable
• Disregard Short-Term Forecasts and Predictions
On Wednesday, we attended a meeting at the Federal Reserve Bank of Chicago and heard William Strauss, Senior Economist and Economic Advisor, speak on the current state of the economy. In spite of the imbalances in the economy in this recession, the Fed is anticipating that the GDP will return to trend line growth (2%-3%) in twelve months.
Liz Ann Sonders says the potential rebound will likely resemble a beach ball that is pushed down deep in the water. The harder and deeper the beach ball is pushed, the higher the rebound when the ball is released.
And finally, keep repeating the first few lines of the Rudyard Kipling poem, “If you can keep your head when those around you are losing theirs…..”
Cicily and the Aequus Team