In my experience – growth ultimately defies fear. And whilst stocks will always climb the wall of worry – over time – growth prevails. The challenge for investors is the pathway is rarely in a straight line. Put another way, markets are constantly in a tug-of-war between opposing forces. Consider what we see today… we have a surprisingly robust US economy, defying expectations of a slowdown. Tailwinds include Fed easing, disinflation and a consumer which continues to spend. The counterforce to the further growth are escalating geopolitical tensions in the Middle East – which threaten to disrupt the global economic order
"Investing Lessons"
A Time of Transition
Think of a time when you worked through major transition in your life. For example, maybe it was the end of a relationship; a deep loss; changing your career; starting a family; or relocating for work. Generally during times of meaningful transition there is a period of adjustment and uncertainty. And sometimes, the change will come with volatility. From mine, it’s possible the market’s wild behavior this week is representative of one in transition. However, it’s still early. Volatility in stock markets are typically associated with meaningful turning points… this posts explore more about what’s happening below the surface; and why I think the 20-year era of cheap money is drawing to an end.
Fear & Greed
Wall St. is driven by just two emotions: fear and greed. Pending on the degree to which you succumb to these emotions – it will have a profound impact on your bottom line. All too often, most investors will do two things: (i) buy when there is market greed; and (ii) sell when there is fear. It’s the opposite of what you should do. However, this is something you need to master if you are to be successful in the game of asset speculation.
Lesson: Don’t Try and Pick ‘Tops or Bottoms’
Everyone makes mistakes. In fact, I love ‘collecting’ mistakes – whether they are my own or from someone else. It’s the only way I learn. This post shares two ‘mistakes’ from a popular media personality. His name is Jim Cramer who hosts a show called “Mad Money”. Earlier this week he said “the bottom is in for CrowdStrike”. Big call given recent events. Fast forward a few days and the stock is 16% lower than when Jim called the bottom. So what can we learn from this?
For a full list of posts from 2017…