In the same headline, at the same time, the Wall Street Journal announced that the US economy shrank 4.8% in the 1st quarter and the stock market was up well over 2.5%. Does this sound crazy to anyone else? What on earth is going on?
News like this can amp up your relief, or your anxiety depending on which side of the page you look. We have all been sheltered at home, no one is unscathed. We are all a little bored, a little antsy, and a little stir crazy. This is uncharted territory, so what do we do?
First, let’s look at a known and proven source. God’s Word.
Psalm 56; “O God, have mercy on me… my foes attack me all day long (but) my enemies retreat when I call You for help… when I am afraid I will put my trust in You, I praise You for what You have promised… …You keep track of my sorrows, You have recorded each one…God is on my side!… So now I can walk in your presence, in Your life-giving light.”
COVID-19 nor the following recession took God by surprise. We live in a broken world, crazy things happen. But this nothing new. Our friend and Sound advisor, Karl Simmons, recently shared an email showing that if you were born in the year 1900 by age 60 you lived through 2 World Wars & a Cold War, 2 Pandemics (Spanish Flu & Polio), a Great Depression, and 2 decades of unprecedented growth (the 1920s & the 1950s). Wars, pestilence, and general craziness is nothing new; granted 24 hours news outlets, “Google”, and “Facebook” fuel the fire.
Second, let’s look at our rules to manage investments.
Market Sentiment is negative. Market Valuations are negative. Economic growth is neutral and going negative. Only the US Federal Reserve policy is positive, they have stated that they cannot keep the US out of a recession but their goal is the cushion the fall.
Therefore, let’s not miss the forest for the trees watching a big stock market bounce and fear missing out. Investing with conservative patience being hopeful in the future is the best idea right now.