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It's a Beautiful Day in the Economy

behavioral finance financial planning economics

Mister Rogers once said, "When I was a boy and I would see scary things in the news, my mother would say to me, 'Look for the helpers. You will always find people who are helping.”

Imagine how frightened Fred Rogers would be in today’s world with social media and 24-hour news stations keeping us "informed" at all hours of the day.  With the variety of news sources, there is a great deal of competition to gain the attention of viewers.  The more sensationalized the news, the more the viewer is captivated by the story.  A captivated audience, of course, is a victory for media outlets.

Many analysts are trying to get the viewers’ attention when discussing a recession.  Everyone wants to be the first one to break the news that we are in a recession.  As my colleague, Jonathan Thomas, so eloquently wrote in his recent blog, Why You Shouldn't Fear a Recession: "The simple fact is: most recessions come and go with very little fanfare."  Thus there's no reason for the hype of a recession conversation to cause you alarm.  You should be positioned and prepared for all market cycles.  The news media, however, has been able to trigger an emotional response from the public every time there is a mention of a recession.

Although most educated investors understand that there are normal market cycles (expansion, peak, recession, trough, and recovery phases of the economy), there is no defined timeline that the economy remains in each phase.  News outlets, however, are doing their best to play with investor emotions and flash headlines to make them feel as though changes need to be made in their portfolios.

At the first sign of an economic downturn, the headlines flash:

  • Recession watch: What is an ‘inverted yield curve’ and why does it matter? (The Washington Post, August 14, 2019)
  •  U.S. Manufacturing Slowed in August in Latest Sign of Economic Weakness (The New York Times, September 3, 2019)

We are currently experiencing the longest economic expansion in history. For nearly two years, the headlines have been flashing reasons that we should be on alert for a recession.   To paraphrase my colleague, Senior Investment Strategist David Nolan, "an economic expansion does not expire because of time."  The is no ONE sign to inform the investor that we are changing economic phases.  There are multiple indicators that need to be monitored.  

The advisors at McKinley Carter Wealth Services are the helpers that Mr. Rogers’ mother was talking about.   While everyone’s idea of “Investing In A Good Life “may be different, we are here to help shatter an investor’s self-imposed doubt.  We believe that with consistent effort and engagement, we can help investors reach their financial goals.  We have a deep bench of knowledgeable individuals that that can help you prepare for whatever lies ahead in the economic world.  Don’t let the news headlines play with your emotions.  Find ‘helpers’ to work with you on your personal situation.

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