Transcript

Hello, this is our weekly market alert video for the week ended April 22, 2022. The question you may have on your mind right now is what the heck is going on? Why is the market going down so much? And what should I do about it? Well, as we’ve chronicled for you in videos over the last several weeks, the big risk is that the Federal Reserve makes a policy mistake, meaning that they raise interest rates too slowly, or they raise interest rates too quickly. It appears based on the way inflation is remaining frustratingly high, that the Federal Reserve is farther behind the curve than even they or the market assumed. Federal Reserve Chairman Powell just came out just a few minutes ago, and essentially told everybody that they’re looking at a much larger rate increase and more of them than they had originally forecasted. So, what it appears is that the Fed is going to have to slam on the brakes a lot harder than people thought. Right now, it appears that the question isn’t, can the Fed engineer a soft landing? The question is now becoming how bad is the landing going to be? How hard are we going to crash into this landing? And so that’s a big concern, of course.

Now, interest rates, based on what they’re saying, are not a good sign for the bond market either, which is normally a diversifier. Right now, it looks like the stock market and the bond market are moving in tandem, when normally, you would hope that the bonds would be a diversifier and be a shock absorber and maybe even go up when the markets are going down. Right now, the way that you might want to look at it is the Federal Reserve is driving a car. There’s a bunch of passengers and they all have a hot cup of coffee in their hand. The last thing you want is to spill the scalding coffee on yourself. The Federal Reserve is driving, you’re hoping they can just apply the brakes slowly, but it looks like they’re so far behind that it may be necessary for them to slam on the brakes a lot harder and spill coffee on all the passengers. That’s what the market seems to be reacting to. What do you do about it? Well, in our world, what we do is we have our investment protect strategy, which says that when we reach a point when the odds are, in our view, dramatically in favor of a big bad bear market coming that we want to take cover, get out and protect ourselves from that.

That’s something perhaps that you might want to consider doing. What I encourage you to do is to visit with one of our retirement planners, you can find them at RPOA.com. Retirement planners of America .com. If you click on meet with an advisor, we’d be happy to meet with you and go over how our strategy works, what our thinking is, in your specific situation. I wish I could give you specific advice, but without knowing your circumstances, that would be inappropriate in a video. So go to our website, take advantage of our resources that are available to you. I wish you well and have a great weekend and we will talk soon.