Oh What Fun These Market Cycles Are!

Wow, what a lousy January so far for the stock market!

I’m writing this January 21 as the stock market “celebrates” its worst start ever.  As often happens when the TV is filled with this type of bad news, some clients are beginning to call us expressing concern about their money.  This is a natural emotional reaction, but a reaction we caution you to be careful of.

Let me emphasize, we do not believe what is happening is a repeat of the 2008 financial crisis, nor something similar.  We do believe we are going through normal cycles, both market and economic.  There are signs the economy is slowing.  We may experience a mild recession later this year.  This is normal; we’ve all been through them in the past.  I won’t get into the economic details in this communique, but call any of us and we’ll be glad to review the trends and data with you.

We’ve had a long 6-year run since the last market bottom in early 2009 so it’s probably long-past time for stocks to back off and regroup.  This is typical, and also expected.  While you will likely see a modest reduction in your portfolio values on your next statement(s), we don’t want anyone to overreact. 

We are confident the money managers we selected on your behalf will do a good job of protecting your money.

Be patient, stay the course and let stock values regain their upward trajectory when the time is right. 

Doug Conoway

 

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