July 25, 2022

FOUNDER’S CORNER:
THE LONG AND GRINDING BEAR

by Jeffrey R. Miller, CFA

The investment climate since Thanksgiving of last year has been a very difficult time for investors. The first five months of 2022 were the worst beginning of a year for markets in 90 years, and there was no safe haven from the Bear.  Stocks, bonds, and all other asset classes fell down.

I have lived through 11 recessions since I was born, and I’m not dead yet! I received my MBA and was looking for a job in the middle of a severe downturn, 6 recessions back, knowing I just had to keep on grinding to find that next paycheck. I have never been unemployed since that time and have been in the position of managing money through 5 recessions. Crash of 1987—no big deal! The S&P 500 was UP 5% that year.

That is not to say that as portfolio managers we are unaffected by emotions. I have spent many a 3am hour or two trying to work through what to do in these scenarios. I reminded myself of a famous old saying to “hurry up and do nothing.” Knowing the history of markets and maintaining a sense of humor helps.

No matter how daunting times like these may seem we always seem to grind through. It is especially important to not let fear overcome discipline in investment management. As my colleague’s chart demonstrates we can, at some point, expect a strong recovery.

As a reminder. this is an excellent opportunity for clients to have their long-term planning stress-tested to ensure that they are still on target, and to sleep better through the storm.—J. Miller

Nothing contained in this post is intended to constitute legal, tax, securities or investment advice, nor an opinion concerning the appropriateness of any investment, nor a solicitation of any type and does not guarantee future results. The information contained in this post should not be acted upon without specific legal, tax and investment advice from a licensed professional. Past results are not indicative of future performance.