We’re seeing the classic signs of what’s called a market melt-up. That’s when the stock market drifts higher in the face of adversity. Quite simply, this is a market everyone loves to hate. Practically everyone is expecting the next shoe to drop any minute now that will cause the next correction or crash. Well, we all know that if something in the market is obvious, it’s obviously wrong!
This situation shows why it’s so important to be properly invested and why thinking you can outsmart the market or worse yet, sitting in cash will kill your retirement goals. The scary part is that bond yields are dropping, which is the exact opposite of the overwhelming consensus for the last year. Again, if it’s obvious….however, that is an ominous sign because when yields go down, it implies that economy is slowing.
What I think is happening here is that investors are just figuring that if the economy slows down again, the Federal Reserve has the playbook spelled out…..print more money and create more economic stimulus….QE4 baby! It’s like when you’re in college and you run out of money. You know mom and dad will bail you out because they want you to have at least a few meals between keg parties. In our case Ben Bernanke and now Janet Yellen are mom and dad, and the last thing they want is another bear market.
The key of course is to be properly invested, and if you’re retired or close to it with a qualified retirement advisor. This will ensure you are looking at the big picture and getting the returns you need, but with the least risk possible so you don’t get crushed the next crash or correction.
…… and that’s where we can help. To learn more about The Springer Investment Approach, which is our powerful proprietary Investment Management Strategy designed to manage risk and deliver returns in any market, or to get a free second opinion on your portfolio, simply reply to this email, or give me a call at 916-925-8900 for a no-cost no-obligation today!