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The Lost Decade
Written by Steve | Published: |
A lot of movement going on this week.
If you haven’t heard, the inflation numbers came out worse than expected a week ago and it put the markets in a spin.
Bond markets pushed up their coupons pushing mortgage rates up almost a point in some cases above 6% the stock market went into bear market territory.
It makes me wonder if we are going into another “Lost Decade”
Between the years of 2000 and 2013 (which is longer than a decade) the S&P 500 returned 0.00%. (not a typo)
Keep in mind that we had the “Dot Com Bust” around 2000 and the global financial crisis in 2007-2008.
When I bring this up with some traditional advisor buddies of mine and ask what they do to get their clients a positive yield during times like these, the knee-jerk response is to re-allocate into bonds. They name these funds as “safe” or “minimal risk” to make them sound pleasing to the ear.
However, now in this environment with rising interest rates (i.e. The Fed just raised interest rates by 0.75% this week) that pushes down the value of most bonds.
So do we just suffer for another decade?
I guess you could if that sounds fun to you.
But what if you could lock in gains along the way and if the market falls again you keep your principle.
We have a ratchet technique that allows you to lock in by month, year or even longer than that to help solidify your growth.
Your profit and growth essentially stair step up and you avoid all this market manipulation stuff.
In an uncertain world we like to help create more certainty for our clients.
To see if this might be a fit for you just reply to this email and we will find a time to chat about it.