It seems the financial media publishes what I call financial pornography.
Every day we hear more bad news about our economy and more bad news from “Wall Street”.
No matter how much we believe that the free markets work and how much faith we have in the underlying system there will be stress in our lives about the future.
Currently, we are experiencing a substantial downturn not only here is the U.S. but around the world. The financial media is making a huge display of how bad the market is. Their concerns for the current downturn and future performance are scaring many investors. These investors are selling in fear.
There are ‘experts’ extolling their prediction was correct. You will hear them say ‘see I told you so’. Keep in mind if a large number of ‘experts’ are making all sorts of predictions someone is going to be right.
It is not skill that they broadcasting but rather that they are the lucky ones. The equity markets here and around the world are random and unpredictable.
We must refuse to be a victim.
In his book former General Electric CEO, Jack Welch points out that feeling sorry for ourselves in one of the most destructive and energy sapping behaviors you can engage in. yes, it’s unfair that the markets are insane and some people are unreasonable.
We must accept this for the reality that it is and move on.
Every minute engaged in self-pity is one too many. In the words of Jack Welch, “Refuse to be a victim”.
Develop a scientific, evidenced based strategy for investing and believe that the “bad times” will not last forever. Believe it or not we must also remember that “good times” will not last forever.
If the markets never went down, investors would not be rewarded with good returns over the long term. The downturns should actually be celebrated because we can rebalance and buy stocks at a cheaper price.
Without risk there will be no or little return.
To succeed in investing for the long term we must own equities…..globally diversify …rebalance!
For all of us this will involve keeping our emotions in check. This proves impossible for most investors. The solution is to work with an investor coach/fiduciary adviser.
It is during down markets as well as extreme up markets that your coach will earn their fees. Allow them to earn these fees by being ‘coachable’.