Stock Market Uncertainty Increasing Along Party Lines

The uncertainty we all feel is actually a great deal of the problem and has been for people for five, ten, twenty years. Markets go up 78% of the time and they fall 22% of the time. But to be living in uncertainty 100% of the time—that doesn’t make sense. It doesn’t have to be that way. 

“The failure of the federal Government…” Have you heard that statement the past few weeks? 

When people say “failure of the federal government,” what they are really saying is the failure of the White House, and by that they mean the failure of Trump. But, you can’t say that. And they know that. If you did, you’d lose half of your audience. 

See, if I would have said something negative about Trump, half of you would have been outraged with me. Half of you would have been so enraged that I dare talk politics. But this isn’t politics. I hate politics. I get anaphylactic shock when people start talking politics. Yes. I vote. But politics? There’s not a political bone in my body.

The bones I do have in my body are “annoyance-of-crap-leadership” bones. I’ve got those in spades. So let’s talk about leadership in your investment portfolio. 

What political party are you invested in? The “buy-and-hold, just ride it out” party or the “just sell covered calls” party? Or perhaps it’s the “there’s-a-magical-ticker-symbol-out-there” party? 

Really. What would you title your political investment party? 

Most people invest down party lines. They buy dividend and deep value stocks and over-diversify because that is what their party tells them to do.  But what they don’t know is: that’s what’s hurting them. Dividend stocks have underperformed the stock market for years. The same goes for value stocks, only worse. Value stocks have underperformed for almost a decade. 

Why do people vote invest down party lines? 

Simple. They’ve never been taught to invest without being attached to the name of what they own. They’ve been taught to care more about what the name of their investment is rather than how well it creates certainty and consistency in their life. 

How did we get here? Be it investing or voting, I see people defending their “deep value” stance. Or their “Exxon Mobil is a great company” stance. Who taught people to care so much about what they own? And not to care so much on how well their portfolio is doing? Really. Where did that come from?  

I have long criticized financial models that can fit nicely into a “planners software package.” The big-box advisors who say that you can safely withdraw X% of your retirement savings every year based on a 100 year old Monte Carlo software model distribution seem guilty of malpractice at worst, or very outdated thinking at best. Those models don’t include human nature. And that’s all investing is. It’s human nature with a price tag. 

I have three videos to share with you this week. I’m sure one will annoy you. One will make you sit up and think. And one will be just “meh.” And those three will be different for everyone.

Video #1 = Are we there yet?
A weekly look at the question, “did we bottom?” I know last week The Wall Street Journal and Morgan Stanley and Barrons and CNN not only said we bottomed, but that we entered a new bull market. If we did, it would be the first time in history that the bottom was in while stocks were in a downtrend.
Video #2 = Portfolios that produce 1% a month of income… for life.
You can actually have it with an off the shelf ETF. Let me show you what you think you get, what you actually get, and what it’s really going to cost you. Spoiler Alert: you’ll feel good but your money won’t. 
Video #3 = Four recession-proof stocks
These stocks are killing it today. And no, it’s not Clorox, Zoom and Citrix. By looking at these four names, you’d have no idea the world was on the precipice of a year of solitary confinement. But the point is to show you how learning to fish is more important than getting some fish thrown at you each week.

Also, I want you to know… your portfolio is the problem. Not the virus. And it’s because you are over-diversified. That is why you’re confused and feel like you’ve lost control. People with $500k portfolios are bleeding out $25k to $50k a year, unnecessarily. In one click, I’ll show you how to get control back over your life.

As always, please let me know what you are thinking.

I’m always standing by at RC@FearlessWealth.com

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