The magazine cover says it all doesn't it?
The inside story is even scarier!
- "Unemployment is UP to 4.8%"
- "Corporate profits are down 10%"
- "small investors now forced to sell everything to cover margin calls and will NEVER return to the market." (my favorite!)
- "Crises of confidence with the administration"
- "Inflation poses a basic threat to the nation's whole economy"
- "Houses are halted, men are out of work"
Holy cow! No wonder I didn't sleep well this past weekend! THESE events would keep anybody awake! Or as we used to say in times like these "I slept like a baby.... Two hours at a time and then woke up screaming." Was this magazine article about the current state of the financial markets and economy?
Solution? The President of the U.S. says "Frankly, if I had any money, I'd be buying stocks right now". WOW! What an endorsement from the leader of the free world!
Anybody catch on yet? LIFE Magazine - June 5 1970!
I picked this magazine up at an antique store about 20 years ago. I keep it handy in my office and share with clients (and myself!) when we see market volatility as we've seen in the last few days and need a little reassurance. It's one of my favorite market pieces to fall back on.
The lesson learned? The markets will ALWAYS have an excuse to pull back especially when we have had four years of equity growth.
We've done our best to prepare you for these times. Remember "Razzle Dazzle, Greece/Grease"? Go back to my website and pull down my blogs as a refresher.
Bottom line- WE ARE OK HERE! I believe the financial markets will be higher by the end of the year and many (including LPL) believe many of the indices will be higher for the year.
No promises! But I do believe we are near a bottom. Look at the client letter we sent out last week via e mail. There is no one issue that has pulled the market back. In fact, without a correction in almost 4 years, it was time AND HEALTHY for the long term.
Stay focused on your objectives and dreams! This is the time that dividend reinvestment plans are most valuable! We're picking up additional shares at lower prices. Using a dollar cost averaging program on pull backs to pick up good quality companies at cheaper share prices. Heck some sectors such as energy are currently at "BOGO" prices from their highs. So this is an opportunity for long term investors, and that's all of you! No short term traders are clients of mine!
We're here for you! All is quiet around the office. I believe we have prepared you well for this time. New money has been deployed into investments as investors see a buying opportunity.
As one of my very first clients told me years ago, "Sambo, you make money on the BUY not on the SALE"! After 30 years at the helm I've seen this rerun.
By the way, one other interesting article in that 1970 LIFE issue was about a 22 year old baseball player that was described as "A Hall of Famer for Sure!" His name? "Little General" Johnny Bench!
Who was that leader of the free world that said it was time to buy stocks?
None other than Richard M. Nixon! Obviously, he didn't buy office security stocks!
I'll leave you on that one.
I hope this blog helps you as we move forward together. Call me anytime to discuss your financial planning.
Sam
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