Broker Check

Third Quarter 2021

As long-term investors, we have seen our fair share of bear and bull markets. With the recent selloff in the market, it’s natural to assume we’re headed for another market crash. In reality, there have only been 5 notable market crashes over the last 100 years. Only 5! They happened in 1929 before the Great Depression, in 1987 on Black Monday, in 1999 during the dot com bubble, in 2008 before the Great Recession, and in 2020 before the Global Pandemic. History has shown us that every time the market has crashed, it’s made a comeback.

It took almost 3 decades for the stock market to rebound from the stock market crash of 1929. Since then, the recovery time has shortened thanks to support from the federal government and Central Bank. It took roughly 3-4 years for the market to recover from the Financial Crisis crash and about 6 months for the market to recover from the Coronavirus crash.

Now that the economy has successfully reignited and roughly 85% of the American public have some level of immunity to COVID-19 (through inoculation or infection), we seem to be closer to the other side of this pandemic. We are waiting to see what decisions Congress will make about future fiscal spending and tax legislation but it’s currently in gridlock. Normally, gridlock is good news for the markets, but not when the nation is nearing possible default. The Treasury Department is waiting on Congress to raise or suspend the debt ceiling, so they can continue to meet their financial obligations. The Federal Reserve is also faced with its own set of challenges to keep inflation in check and labor markets healthy. This will likely lead them on a path to unwind their easy monetary policy and raise interest rates.

There is always a reason for investors to be concerned. If it’s not one thing, it’s another. We know everything resolves itself over time, until the next thing pops up. It’s a cycle we see repeatedly, which is why we remain cautiously optimistic. The best strategy in any environment is maintain a disciplined approach: make sure everything in your balanced and diversified portfolio still serves a purpose and stick to it. It’s hard to get derailed when you have a plan and believe in the process.

We can work with you to reassess your current portfolio allocation, risk tolerance, and financial needs.  Please let us know if there have been any changes to your financial circumstances, goals, and/or objectives.  Warm wishes to you and your family this upcoming Holiday season!