Maybe the subtitle for this post should be Tiny Bubbles, Temper Tantrums and 3 Ways to Go North or South with Your Portfolio as 2017 unfolds but let me more blunt and to the point. The Bible tells us:
"Ecclesiastes 5:10 tells us Whoever loves money never has enough;
whoever loves wealth is never satisfied with their income.
This too is meaningless."
Way before the Longest Bull Market in History started in the late 1980s there stood a confident Humpty Dumpty Bull Market that started with the ascension of the Reagan Revolution. This Bull Market in the early 1980s began with the confidence that President Reagan initiated through overturning cumbersome business regulations, crushing staggering inflation and reducing the tax burden on all Americans. Retirees were even able to pad their portfolio with : AAA tax free and tax deferred savings & investments vehicles producing double-digit returns with liquidity. Many survivors of the sideways 1960s-1970s market that went nowhere recalled the big Don Ho hit of the times which helped them forget the civic and social unrest of the decade that saw the stock market stagnate from Dow 1000 in 1966 to the same level in 1982 16 years later.
"Tiny Bubbles (Tiny Bubbles)
Make me warm all over
With a feeling that I’m going to
Love you till the end of time"
Savers and Investors were happy again as the Reagan first term produced an average 15% stock return from 1981-1983, according to Reuters, despite a first year for the administration that produced a negative return. Happy Days were certainly there again in a big way and may be here for a season again if policy moves ensue that are market movers. Then as in now, markets get ahead of themselves and the Reagan trade came unraveled in 1984 as interest rates rose and the market dropped nearly 4% The news media including Business Week had pronounced “Stocks Dead” on their cover in 1979 were circling the wagons again in 1984 and telling folks to run for the hills. Another 1960's song by the Youngbloods "Get Together" was more to the moral point regardless of where in this stock market and economic cycle we are. It paraphrased the message of Ecclesiastes the "all is vain" including the pursuit of money and encouraged us to "smile on our brother and everybody get together, right now". Right now we see a faint glimmer of many loving this market a little too much and reminders in the past of what false hope leads to in the dust bin of broken stock portfolios and busted dreams.
Investors who stayed the course were richly rewarded, albeit with the one infamous October 19, 1987 day when the market was down 22.8%. Investors were richly rewarded as the Reagan Trade had legs and carried investors to the biggest gains of the modern-day market. The current Trump trade since the historic election is making many investors feel “warm all over” but in the 9th year of the second longest Bull Market in history, investors should look out for “Tiny Bubbles” even if the big picture looks rosy. Bear market Waldos can be found in the most inconspicuous places. Here’s a few to certainly pay attention to as Trump’s policy initiatives are rolled out and implemented:
Money can buy a House............But not a Home
Money can buy a Bed..............But not Sleep
Money can buy a Clock............But not Time
Money can buy you a Book.........But not Knowledge
Money can buy you Medicine.......But not Health
Money can buy you Sex............But not Love -
MasterPlanYourRetirement | MasterPlanRetirementMoment
Investment advisory services are offered through MasterPlan Retirement Consultants, Inc. doing business as MasterPlan Retirement Consultants. MasterPlan Retirement Consultants is a Registered Investment Advisor in the State of Georgia. Insurance products and services are offered through Fricks and Associates, Inc. doing business as MasterPlan Retirement Consultants. MasterPlan Retirement Consultants, Inc. and Fricks and Associates, Inc. are affiliated companies. All written content is for informational purposes only. Opinions expressed herein are solely those of MasterPlan Retirement Consultants, Inc. and our editorial staff. All information and ideas should be discussed in detail with your individual adviser prior to implementation. MasterPlan is not affiliated with the Social Security Administration or any government agency.
Here at MasterPlan Retirement Consultants, we strive to keep you up-to-date with informative articles. Read on for more details of the latest and greatest news.