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Half Full?  or  Half Empty? Thumbnail

Half Full? or Half Empty?

Half Full?  or   Half Empty?

What is your outlook?  Where is your focus?  Fretting over past mistakes?  Celebrating past successes?  Worried about your future?  Looking forward to the future? Or merely experiencing the moment?


All of us have been in each of these places many times in life. 


This is the first week of May 2022.  As a financial advisor, I will do my best to “keep to my knitting” as they say and attempt to avoid waxing philosophically about the larger life questions.


Last week I was on vacation and only late on Friday afternoon did I overhear someone comment on the stock market performance for the day.  Holy s___!   That was a tough day.  What to do next?


First, allow me to comment on where we are now.   The all-time market high point was January 3, 2022.  Since then, all stock indexes both in the U.S. and globally are down 12+% year-to-date with two-thirds of the decline happening in April.  The Nasdaq, tech heavy, index is down 23% from its November 23, 2021 high point and down 21% YTD. In light of that information, the glass is half empty. (1)


However, the glass is half-full when you realize the S&P 500 is up 91% since the March 23, 2020 low; the Dow up 85% and Nasdaq up 83%. (1)


The yield on the 10-year Treasury bill is approaching 3% which eventually may filter down to money markets and saving deposits.  However, bond investors are feeling the pinch as bond values are down from 5% to 10% year-to-date.  Remember, bond values go down when interest rates rise. (2)


Many commodity prices are up substantially due to supply chain issues, the impact of the war in Ukraine, sanctions on Russia and the continuing tariffs on China. (3)  All of these factors are impacting consumer prices, inflation and economic growth.   This means the cost at the grocery store, gas pump and Home Depot that are easy to spot are up but also items like plastic products and packaging (30% of oil is used to make plastic), auto parts and electronics (made in Ukraine and China).  Lest we not forget the continuing and ongoing impact of Covid….it is far from over.  The Chinese economy is slowing with strict lock-downs due to a “zero-tolerance” policy with large numbers of people not just on home quarantine but locked into detention for testing positive or merely exposure to an infected person which continues to impact the supply chain. (4)


Because of all this, I remain an optimistic investor !!!  Yes, I will say it again…I am an optimistic investor.  No, I am not crazy.  Nor am I naive.  Or unrealistic.   I am an optimist.  There is a difference.


I have been in this industry since 1980.  Yes, it is scarry to think that this is the 42nd year.  But over that time, shall we say, the horse has bucked many times.  But you have to get up and get back on.  Riding is still better than walking.  And if you decide to just sit on the ground, you go nowhere.   Plus, it is dirty on the ground and you eat everyone else’s dust as they go by.


The markets have always recovered in the past.   Call me, I can prove it to you. (1)  Looking back, the best time to invest is when it looks the worst and your gut feels like it is tied in knots or you maybe even feel like vomiting you are so afraid.  This is a great time to be investing money !!!


It could possibly be a better time to invest tomorrow, or next week, or next month.  But in the same way, the markets may be up tomorrow.  No one knows that.  I just know that today, the market is about 14% below a previous high….and it will at some point be higher and then much higher than that previous high point….so I want to be buying now. 


That being said, don’t be foolish.  Don’t bet the mortgage money on a rapid market recovery.   Don’t put your high-school senior’s college money in a growth fund.  Don’t even put next summer’s vacation money in the market.  Keep your near-term financial needs in cash !!!


However, if you plan to live a while or at least don’t plan to spend all your money, be prudent, thoughtful and loving to yourself and your legacy.  Do the best for them and yourself and remember that you will need to earn enough to offset the effects of both taxes and inflation.  If your money is to grow, you need to own assets that will appreciate as much or more than inflation.  Bank accounts won’t do it, nor will bonds.  Bank accounts and bonds are merely place holders for capital waiting to be spent.  Stocks and real estate are growth assets.


This is what your financial plan is about.  It maps your route to financial peace of mind.   The financial plan takes into consideration these financial melt-downs and recessions.  The financial plan is not a “Polly-Anna” best case scenario.   It is a realistic, serious plan for the future that takes into consideration the bumps, bruises and wrong turns that life can present.


You need to stay invested and if possible, invest more when the markets are down.  Call me and we can talk further.


Wollman Wealth Design, Inc is a financial planning and investment advisory firm in Escondido, CA that partners with people in San Diego County, California and the rest of the country who are striving to identify financial priorities and design a reasonable approach to accomplishing their financial goals.  Please contact us with questions, comments, or to schedule a phone call or a Zoom or an in-person office meeting.



1. https://www.macrotrends.net/2526/sp-500-historical-annual-returns

2. https://home.treasury.gov/policy-issues/financing-the-government/interest-rate-statistics

3. https://fred.stlouisfed.org/series/PALLFNFINDEXQ

4. https://www.reuters.com/world/china/chinas-zero-covid-policy-numbers-2022-04-28/

Securities and advisory services are offered through Cetera Advisor Networks LLC (doing insurance business in CA as CFGAN Insurance Agency LLC), member FINRA/SIPC, a broker-dealer and registered investment adviser. Cetera is under separate ownership from any other name entity. CA Insurance License #0604093

"The views stated in this letter are not necessarily the opinion of Cetera Advisor Networks LLC and should not be construed directly or indirectly as an offer to buy or sell any securities mentioned herein.  Due to volatility within the markets mentioned, opinions are subject to change without notice. Information is based on sources believed to be reliable; however, their accuracy or completeness cannot be guaranteed.  Past performance does not guarantee future results.