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And it’s back.
Just when things were inching their way upwards.
We get hit with another round of trade wars (wrote an earlier piece here), and now further interest rate cuts from a few of the central banks around the world…
Looking decidedly SHAKY ain’t it?
Suffice to say, yours truly has been caught up with the recent sell-off, down about 6 grand in the space of a week.
Who said investing was easy!
I find it a bit ironic that I place so much focus and attention to equities, considering it is a small fraction of the overall net worth yet has an enormous effect on emotions and thought processes.
Can’t help it though right? When you’ve got the media blasting any negativity and doomsday scenarios as they can find each hour.
Or when you have colleagues and friends jumping up and down because the market’s down 2%…
That’s why $60,000 in shares might seem like $600,000 – or a $6k down move feels like an anchor tethered to your innards…
To be honest, so what?
That’s just part of investing.
Although I’m still relatively confident that it’ll be OK in the medium term, OH LORDY PUH-LEASE let it be so.
Personally I think the market was getting a bit topsy so was due for a pull-back of some sort.
And what gives me a sliver of hope is that this latest drop – brutal and swift as it is, ultimately can be fixed.
It’s all politics methinks.
Either the Donald McDonald or Chinese Winnie has to blink first.
It kinda differs from the GFC or tech bubbles of yesteryears when there were systemic issues and rampant speculation.
I think a key point to also note is that markets react to the unexpected, not when things are “priced in”.
So I’d be expecting some big volatility in the weeks and months ahead as we try to come to terms with pieces of news that filter through.
The cutting of global interest rates is interesting though… on the one hand you’d think that it symbolizes a lagging global economy (that’s bad!), but then should stimulate cheap and easy credit (that’s good!), although cheap and easy credit is only cheap and easy if you are going to put it to good use (um, can I go now?)… so it’s definitely worth paying attention to.
Still, ultimately I’m going to go on a limb here and say equities will come good again pending the schoolyard bullies coming to terms with each other.
I mean, what’s the point of a blog if you’re not going to express an opinion right!
In fact, if it drops significantly more… well, let’s just say that there’s a 6 digit credit line just ITCHING to get stuck in.
Licking my chops just thinking about it.
What do you think? Am I on the right track?
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