"Braving the Bear (Market)"

I rarely post a blog since Liz does a great job of keeping you in the loop on our lives in Colorado, but I thought I'd give a little commentary in my world.

This blog moment is coming from the other half of the BLIZ team (Bill) and is brought to you today by the letters "L", "D" and the number 10.

As you can imagine, I've been doing a lot of "hand-holding" with clients who are concerned about their investments. Consider these news headlines:

"STOCKS SLIP AND CRASH - Violent Plunge Brings Panic"

"PANIC RAGES IN MARKET"

"NO PLACE TO HIDE - It's been a rough year on stock exchanges around the globe"

"ANOTHER BIG COLLAPSE OF BUYER CONFIDENCE"

Sound familiar? When do you think these were published?

The first two headlines featured in the Los Angeles Times on October 4, 1929. The third was published in Barrons on January 9, 1957. The last one was printed on November 23, 1974 in BusinessWeek. What can we take away from this?

If your long-term goals haven't changed, your investment strategy shouldn't either. The letter "L" is for Long Term Strategy. Many people have abandoned their long-term money and put it into short-term positions (i.e., savings, money markets, CDs). While their money is protected from investment loss, it is actually losing purchasing power due to future inflation. A CD earning 2 percent at the bank will never catch up to the inflation rate of 3 percent!

The letter "D" stands for Discipline. Instead of buying low and selling high, people tend to to just the opposite during a market correction like what we're experiencing now. We are emotional beings, and even the most logical people will stop investing or pull their investments when things feel uncertain.

The number 10 represents the rate of return in the stock market over the past 75 years. Our most recent bull market was one of the longest runs we've ever seen. Historically, the market has responded dramatically every year following a bear market. It's anybody's guess what kind of jump we'll receive from the next bull run. People who have taken themselves out of the market are going to miss it.

At the end of the day, it is time IN the market, not TIMING the market, that is going to carry your long-term investments forward.

Enough money talk :) Have a great week!

** Bill's mugshot can be found at http://www.edwardjones.com/en_US/fa/index.html&CIRN=313269