Here We Go Again
Now that we’re back at all-time highs in the market, the usual content machine is running its course. Bearing that in mind, please never forget that:
- No one can predict the future. Not when the market is tanking. Not when the market is on a tear. Never.
- Most financial content is marketing. They want your business.
- Investors are often their own worst enemy. Acting because of fear or fear of missing out will do much more harm than a bear market.
This spring, the market took it hard on the chin.i Pundits everywhere said the worst was yet to come. Now we’re setting new all-time highs, and those same pundits are telling us how long the rally will or won’t last.
They didn’t know what was going to happen back in March, and they don’t know what’s going to happen now. No one does. Some will sound a lot smarter than others, but “pessimists sound smart; optimists make money.”ii
i That drop was standard. Every year, on average, the market experiences about a 15% intra-year decline.
ii With thanks to Nat Friedman. Beware the seduction of pessimism.
