When bears are loud, consider this

When bears are loud, consider this

June 09, 2022

Some gloomy headlines are coming out of Wall Street lately. Have you noticed?

In recent days, I’ve read things like “Brace yourself for economic hurricanes” and “Wall Street investor survey paints a dire outlook.”  Oh - and don't forget words like "inflation", "stagflation", and "shrinkflation."  It makes you wonder where the bullish thinkers have gone.

While negative headlines are eye-catching, a gloom-and-doom perspective misses some finer details. For example, look at how positively the financial markets reacted when the Fed’s May meeting minutes were released. What does this indicate? To start, investors feel confident in the Fed’s plan for interest rates.  I believe most are happy they are just FINALLY doing something about the runaway inflation that most seem to have noticed about a year ago.  Also, three out of four companies posted positive earnings and strong revenue in the first quarter. It’s important to remember that companies are healthy, even if that doesn’t make for the most sensational news.

Bearish sentiment may be trendy, but keeping a broad perspective never goes out of style.  Continuously following the herd, as history has showed, can have dire consequences.  Knowing your risk tolerance, and navigating your investment plan within those barriers, will give you comfort when those "loud bears" decide to interrupt.