Weathering This Financial Storm

I wanted to offer you all a little good news about this economic turmoil we are all going through, and that good news is, that you can relax and turn this into a positive experience! Let me explain how.

I know that my house fluctuates in value. But I don’t stand in front of my house month-by-month or day-by-day, let alone minute to minute watching a ticker-tape of my home’s value going up and down. We all know that house values fluctuate, especially during a natural disaster like a hurricane or an earthquake. But because I have no knowledge of the actual decrease, I don’t think about selling my house as it decreases in value. I think, instead, that I’ll be in my house for a long time and the house value will recover over time. Thankfully, there is no one to tell me how much my house is worth on a daily basis! Knowing that information would, at best, ruin my sleep and at worst, provoke me to react in a financially self-destructive way.

Unfortunately, the information on the daily movements of my investment portfolio IS available to me. Most of my money invested in the stock market is there to cover my expenses in the next 15-50 years; therefore, for some reaso
I think it’s critical for me to know how my portfolio is doing minute to minute. When I log on to financial websites or listen to the news with up-to-the-minute information on the market, the news has the illusion of being useful. And the media is being paid by advertisers to convince us that the informatio
IS relevant.

The stock market is doing its best to provide a daily appraisal of the value of thousands of public companies. But we’re currently in the middle of a financial hurricane. We all know it’s unwise to sell a house in the middle of an actual hurricane, like Katrina. So why would we sell our stocks in the middle of a financial hurricane? History has always shown us that we must wait for financial storms to subside before the markets will fairly appraise our homes and portfolios. Once the storms subside and the skies clear, the public, acting as an appraiser, is able to restore normal valuations.

It’s simple : keep your money diversified and take advantage of opportunities as they arise. Some of the richest people in the world made their money by staying centered and awake during the darkest days of a storm.