Transcript

Hello, and welcome to our market alert video for today, which is August 5, 2022. And I know this day very well because today is actually the day before my daughter’s wedding. So finally, the wedding is here. And you know, it’s crazy, because I kind of think of like Usain Bolt, the world record holder for the 100-meter dash. And he does it in I think, under 10 seconds. So, he practices for his entire career practically, but certainly for a whole year for when the Olympics come, and he runs a race that is just 10 seconds long, and it’s over just like that. And that’s what I think of as weddings. Weddings are like a year of drama, who’s going to sit with whom, and what’s it going to cost and this and that, and the logistics, and the invitations, and the dress, and the flowers. Oh my gosh, it’s a million things. And the whole thing is over after 20 minutes. It’s like, oh, my gosh, but it is the process.

And, you know, one of our one of my clients once told me, there’s two things, two pieces of advice I give you. He said, the first one is if you are asked your opinion, the answer is, “What do you think?” And then the second piece of advice is right after you’ve said that you wait two seconds, you turn around and you run the other way as fast as you can. So that’s what I’ve been doing, staying out of the way, staying out of trouble. And so far, so good. But tomorrow is the big day and my middle daughter will be married. And we’re very excited. We love our future son-in-law, and all is well.

So, let’s talk about what’s going on in the markets. More importantly than that. One of the things that has been going on right now is just raging debate as to whether we are in a recession or not, you know, some people define it one-way, others define it another way and is it really a recession? Or is it not a recession? And should we care? In our view, we don’t care. It doesn’t matter whether we’re in a recession or not. What we care about is what the market is doing, not what the economy is doing. And as you guys know, we’ve told you in our video casts in the past, the market is not a reflection of the economy. It’s a reflection of corporate profits, which indirectly or the economy, but not necessarily.

The other thing that is raging right now is, you know, given the way July went, are we in the beginning of a new bull market? Or is it just a bear market rally and it’s going to drop from there? You know, our opinion, we think it is the second, a bear market rally that’s going to go further south from here, but we could be wrong. So, the question that you might be asking is, well, what do I do? You know, I’m within five years of retirement, I’m retired already. So, all these experts are giving me completely conflicting opposite viewpoints. So, what do I do with all of that? Our view is, for now, we are as you know, in cash, we’re not in stocks, we’re not in bonds, and we’ve been so for several months now. And the reason why is because for us, the equation is not recession, bull or bear market, the equation is risk is the downside risk greater than the upside potential. When that dynamic is in place, we consider our clients retirement to be at risk. And if it’s at risk, we don’t want to play, okay, it’s just like that. It’s like that song, you know, you got to know when to hold them and when to fold them. Well, sometimes just folding is a good idea and getting out and just mitigating your risk.

So, what should you do is dependent upon your situation, your cost of living, your sources of income, your expenses, what future sources of income you’re going to have, what future expenses you’re going to have? What’s your family situation? How old are you? All of those kinds of things factor into what you should do right now. But overarching, all of that, you know, our philosophy it is that growth is important, but protection of principle is even more important. And right now, we believe that you should be thinking protection of principle. Now we could miss out on gains and on my podcast, I talk about you know, if you get in late and you miss out on gains, is that terrible? The answer, in our opinion, is it’s not. Missing out on gains is okay, in our view, incurring large losses is not okay, in our view, okay, if you get the difference.

So, here’s what I’d like you to do. We can help you navigate through all of that and make decisions and explore how much risk is appropriate for you. Simply go to our website, it’s rpoa.com. Visit with one of our retirement planners. We’ll do it at no charge or obligation. If we can help you fantastic and if not, that’s fine too. Either way we will part friends, and we’ll look forward to another day.

So, share this video with your friends. We want to help as many people as possible, but right now we are on a risk off. We don’t believe that the upside is greater than the downside and the equation does not in our view warrant as being invested right now. We’ll keep you posted on that of course so again thank you for watching this video and we will talk soon.