Just a note being sent along to help us all focus on the pathway ahead after an ugly day in the markets.
First – an apology.
I received an email this morning which expressed anger over risks that my morning notes might cause panic and angst. The writer felt that I had gone off course in some of my comments. I wanted to state to all who read the morning notes that if this was ever perceived by any reader, today or any other day – my most sincere apologies are sent along – now – and always.
Be confident that I recognize my writing is not always perfect and may, at times, not get the intended points across to all readers. And yes, I can ramble unfortunately. However, please always know I take the idea of sending a note to you very, very seriously. If my passion at times comes across as verbose or off course, I am sorry – it is never intended to be negative or harmful. No matter what, always be assured I send the note for only one reason…and here it is:
To make an extra – personal – effort to let you know we care very deeply about your interests and the manner in which harsh times in markets can sometimes affect your concerns – and possibly shake your confidence. Know in your heart – as we do in ours – that we strive to do our very best to help shine a light on the required long-term pathway ahead…especially when it seems darker than normal.
If you ever feel these notes have failed to do so on any day – please know you have my apology – and the commitment to work at being more effective on the next one.
What a Day, Huh?
Don’t be swayed. It is in the heat of the deepest part of the battle where more goals are lost from fear and its, sometimes sub-conscious, impact. Somehow, someway, when it seems the very ugliest of times possible, history suggests we etch in a turn, a low, a settlement if you will – with the market’s gyrations.
We have a video in the library which helps you to step back and recognize these times in the past. We call this the five most expensive words in investing:
So, as the beast currently attacking the crowd’s confidence wears itself out, we have a few thoughts which tend to shed light on the path – no matter the short-term events which unfold:
√ The US gets over things.
√ Hurdles create new events, resolutions and opportunity.
√ A focus on dividend income from decades of payouts, through thick and thin – will help you recognize your pathway is solid and pointed toward your goals even during the storms.
√ Your goals did not change today – or over the last 15 days. They remain the same and will always be so.
√ This means throwing out long-term plans or radically changing a portfolio makes absolutely no sense. It just tricks you into “feeling” better. Locking in permanent losses today, while rushing into an asset class that yields nothing, is a surefire way to be unable to pursue your dreams tomorrow.
√ I have heard it said better this way before : Practice your ABC’s – “always be cool…”
√ Some of the older guys in the audience of experts being paraded across your screens now tend to be the ones with the most battle scars – and those scars usually, begrudgingly at times – seem to consistently state the same: this too shall pass…even while it hurts going by.
√ Helping clients contain their fears is our goal and purpose here. Always has been – always will be.
√ We get to work with some of the best advisors in the industry and as a team – our goals are seeing you meet yours.
√ Keeping clients from doing what might feel like a relief now but is sure to represent a mistake in hindsight, drives our passion during times like this.
√ Helping you refocus on why you are investing in the first place, and all the things you want to fund and enjoy in the future is what drives us. And when it feels this stressed – it is a call for “Game on” for us both.
Be cognizant of the other trick ponied about:
Nobody “called this.” Sure, we have covered often the people who have been shouting from the rooftops about recessions for years – the same people who have been calling for recession every year.
For sure, many of those have spent over a decade (11 years today to be exact) and about 22,000 Dow points – predicting bear markets – forever. This doesn’t take talent. If you can find me someone who was a bull until late January and then a bear beginning in February I will be surely impressed.
But here is the step right after that: that person will not have the ability to tell you when it’s over and time to “get bullish” again. A perfectly correct economic or market call, that cannot be repeated in the future, is worth just as much as no call at all. Luck, guess, a shot in the dark come to mind, sadly.
How we wish there was an easy way – we’d be the first suggesting it.
We also get this a few times in notes during every stressful window:
“Mike – Why don’t we just sell everything and wait this out? Get back in when the dust settles?”
You are not alone if you feel this way – it has been a trick played on all of us – many times – overthe decades. It’s a great question for sure – and not always asked out of mortal panic. The truthful answer though is that you won’t know when the dust settles. Those are always “rearview mirror” events – and almost always associated with the worst feelings possible.
And by the way, when the dust does settle -prices are never lower. They only feel better when they are higher – very often having already rallied furiously, in anticipation of the proverbial”all clear.”
Good Steps While Waiting
There are positive actions which lead to solid benefits during turmoil like this.
This week and last we reviewed accounts with Advisor Partners to make sure that all clients not using their dividends as income currently, had their DRIP programs turned on.
The good news?
They will automatically be buying more shares of their positions at panic-driven lower prices – painlessly, if you will.
And that adds up far more quickly than many perceive.
Most important of all?
Turn off the news. Spend time with kids, check in on a good book. Catch up with a friend. Watch your favorite show – walk on the beach, or take a trip to the gym. This will all pass.
And when a J&J certifies a spray that disinfects all surfaces of the coronavirus contact and/or XYZ Medical gets a fast track FDA approval for a vaccine which just killed the virus in 70 test patients, this 2,000-point down day today will be a 3,000-point up day before you can ask your wife what the password to your online account was.
In the end, investing for your future can be, and often is, the most humbling experience possible. It can make you question your sanity in more ways than one.
But, as our Moms and Dads once told us all, usually when we weren’t listening: You only have control of one thing – your own actions.
The other stuff will work itself out, regardless of what you think or say or do. So stay focused on the goals at hand and rise above the noise. Be silently armed with confidence, wisdom, patience, humility and a sense of humor.
Sometimes you are ahead – sometimes you are behind. The game is long and in the end, it is only against ourselves.
To each reader:
If we must have a new layer of panic on top of the new virus – now is a great time to do it. Because it came to us when the US was strong on many fronts. And when it is fixed:
√ Car lots will be filed with those who may have put off buying a new car
√ Home-model sales offices across the land will be filled with Gen Y buyers – taking advantage of new, record-low mortgage rates
√ Restaurants will be packed with people “getting back out”
√ Shipping lanes will be filled to the brim moving inventory into starved pipelines
√ Flights will be booked solid to see family and friends
√ New technologies will be created to fend off further implications
√ New services will be branded to solve the next one like this – or make it easier to work with and move beyond
√ And do not forget the even larger event to unfold:
Fear, panic and hysteria – are all going viral. Mentally strive to stand above it.
To help you do this, review this quick video again about corrections:
…there will be more later – but for now…signing off for the night