Blah, Blah, Blah

Pretty much every time I talk with a client these days they tell me about how so and so on TV, on-line or in the paper is sure the market is due for a correction.

How do they know? Can they predict the future? Will averages, or valuations or indicators that have been right some percentage of the time in the past be right again?

If the market does correct then how much will it correct and for how long?

No one can predict the future. People have an emotional attachment to money: they earned it, they saved it, and they don’t want to lose it. When they hear this kind of gibberish from an “expert” they may have a chemical reaction in their brain causing a fear of loss with an accompanying desire to do something about it.

What is there to do? What if you sell your stock holdings based on fear and that action winds up giving you exactly the opposite effect you desired? Maybe short term you’ll feel smart, or safe, but your actions would have been purely speculative.

Don’t gamble with your hard earned money. Those people on TV may be smart, or slick, or well educated, but they can’t tell the future. If they knew anything special they wouldn’t tell you about it.

So long as the underlying fundamentals (based on human need) of our global economy remain in tact then staying with a carefully considered portfolio is highly likely to win out over speculation based on fear, or worse, the idea that a person thinks they have some unique notion, or feeling, that will help them outperform buying and holding low cost reliable investment funds.

There are people who have special information about a company, or situation, and the law limits how they might profit from it.

The next time you feel fearful from what some talking head is saying, whose motivation is likely marketing, or income in one form or another, realize the natural humanistic reaction and consider its value. We can evolve.