Should You Be Worried About the State of the Economy?
In the past few weeks, we have received a lot of questions about the current state of the economy, fears of a “trade war,” and questioning whether or not all of these changes will cause the US to fall into a recession.
From our perspective, the US Economy is still very strong. The more reliable, important indicators of a strong economy continue to remain stable and point to healthy growth.
As you may have heard us caution before, media outlets tend to sensationalize news to gain more clicks, more views, and more attention. We think it is important to take notice of the current events, but not let them drive the investment strategy without evidence of their impact on the overall state of the economy.
Anticipating what markets will do based on the day’s news and reacting because of it, amounts to trying to time the market, which we do not believe is a worthwhile endeavor, nor possible to do with any accuracy or consistency. Instead, we prefer to structure our portfolios based on larger, more historically predictable economic trends, and use the short-term volatility as strategic buying opportunities.
This is not to say that a recession is not on the horizon. There will be many more recessions between now and your retirement, and even beyond. Recessions are a normal part of the economic cycle. The important thing to remember is not to let current events derail your overall financial plan.
As always, we are here if you would like to talk and discuss your specific portfolios or financial situations and can answer addition questions as needed.
ACap Asset Management, Inc. is a “Fee-Only” investment management firm headquartered in Los Angeles, CA specializing in helping doctors and healthcare professionals make sound financial decisions.
Contact ACap Asset Management at email@example.com or 818-272-8511.