Musings On The Markets

“If you’re in the market, you have to know there’s going to be declines.” –Peter Lynch


Saying things are a little rocky right now in the financial markets would be quite the understatement. The S&P 500 was down almost 4% last Friday. It’s currently 14% off it’s highs. Other parts of the market are down even more.

Here are some of my random thoughts on the situation:

  1. Risk assets (i.e stocks) go down. Truth is you don’t earn return on your money without accepting some risk.
  2. Investing would be much more fun if our portfolios just went up all the time. Truth is investors who are patient enough to sit through some losses are rewarded in the long run.
  3. Things look pretty bleak right now. Inflation is high and interest rates are rising. Truth is investing when things are bleak typically works out if you have a long-term time horizon.
  4. I don’t know when things will get better. Truth is things will get better..
As my friend Mark Matson is fond of saying….”I don’t know what the next !0% or 20% move in the market will be. I do know that the next 100% move will be up”.