“Someone’s sitting in the shade today because someone planted a tree a long time ago.” – Warren Buffett
In our latest video, Mike Brady of Generosity Wealth Management discusses the importance of focusing on actionable, forward-thinking strategies in investing rather than getting caught up in the minute-by-minute analysis often seen in the media. With a look back at the previous quarter’s successes and insights into future market potential, Mike emphasizes a practical approach to investment that’s designed to navigate the inherent uncertainties of the financial markets.
Transcript
Hi there! Mike Brady with Generosity Wealth Management, a comprehensive, full-service financial services firm headquartered here in Boulder, Colorado. I’m here with my quarter end video and newsletter.
I want to start off with a question that someone gave me this past quarter. They said, “Mike, your videos are not often very technical. Why is that? Is there a thought behind it?” I want to assure you there absolutely is a thought behind it. There are lots of value-based and technical analyses out there every single minute of every day whether you want to read it or you want to watch it on CNBC or Fox Business News. You can watch for an hour or an entire morning and get lots of technical analysis on the cable news. You’re going to be very exact about something that might not really matter. It’s very interesting, but I’m more interested in the aspects in a very short amount of time, which is a lot of our thinking that will make us successful. I will tell you that one of the problems that I have – you’ve heard me say this before that I don’t watch TV news is because it’s 24/7. When we had a half-hour news, maybe in the evening, you have to be concise. What are the most important things? That means you get rid of a lot of superfluous information and talk and opinion. That’s just not the case when you have to be very clear and concise. That’s the approach that I take with the videos as well. What is the most important in a few minutes that I can impart that will be actionable, and that will make a difference? Being completely exact about something that doesn’t really matter isn’t interesting to me. Go ahead and read that in the Wall Street Journal or watch that on some of the specific business ones and you’ll get that. Every once in a while I sprinkle some into my videos but not very often.
Let’s talk about what I think about the last quarter. It was great. By the time you’re watching this video and I’m recording this on Sunday, March 31. By the time you get this video, if you’re my client, you’ve already gotten your statement. You’ll have seen that the unmanaged stock market indexes are positive. The bond indexes, depending on the duration, are either up a little bit or down a little bit – the unmanaged bond indexes. So, pretty flat or, like I said, plus or minus a few on the unmanaged bond indexes.
The real big news is how strong the equity markets have performed. It is very common just about now in the cycle where people say well, it’s obvious that it’s at a high. What do we do when the market is at a high like it is right now? My answer is well, it’s a high compared to what? I mean, it’s a high compared to a year ago, and it’s a high compared to five and ten years ago, but I hope that it’s a low compared to what it’s going to be. To be honest with you, the Dow Jones Industrial Average, which is an unmanaged stock market index, used to be 5,000. Then it was 10,000, then it was 20,000 and then it was 30,000. Now it is almost 40,000, and by the time you watch this video, maybe it will have gone over 40,000. I don’t know – it hasn’t as of Sunday, March 31.
All along the way, when it was at 10,000, I heard people say, “Oh yeah, it’s obviously at a market top. What should we do? Oh, it’s obviously at a top, it’s 20,000.” And then at 30,000. We’ll continue to say this all the way up as it continues to go forward, which I believe that it will. If I didn’t believe that it would, why would I have investments? Why would I have any exposure to any kind of a stock or equity-based investment if I didn’t think that the future was going to be higher than it is today? I don’t know when it’s going to be higher, but why else would I have investments if I didn’t think that the future was brighter than putting it into some kind of a cash or stick it in my mattress or my pillow.
I think that’s a really key concept that we have to remember, and don’t listen to others who might say, “Oh no, now it’s going to go down as we hit the election” or “This is a year that’s going to see all kind of turbulence” and this, that and the other. The future is inherently unknown and we have to keep that humility in mind at all times. That’s what I want to impart on the end of the first quarter. We have three quarters left. We have an election and we have a lot of stuff happening. Hopefully we’ll have some decline and decrease by the Fed on the interest rates.
What I want us to really remember is we have investments for a reason. That’s because the future, we believe, is going to be better than it is right now and we’re going to make profits along the way. If we don’t feel that way you’ve got to give me a call because there’s a mismatch. There is a mismatch in your thinking to what you might be doing, and it’s better to do that proactively now than later. That’s my message for today.
Michael Brady, Generosity Wealth Management, 303-747-6455. You have a wonderful week, a wonderful quarter and don’t listen to 24 hour news. It’s horrible. I hate it. Thank you. Bye-bye.