financial planning Archives - Argent Bridge Advisors

Headlines have dominated the market the past two months and the week-to-week market direction has been manic.
$10,000 invested in the S&P 500 in 1970 grew to over $2.6M at the end of March 2024, ignoring fees and taxes. During that period of time:
- From 1965 to 1981 the top marginal tax rate was 70%. Only after 1987 did it come down under 40% where it has been since.
- Interest rates were above effectively above 5% from 1972 to 1991. Almost 20 years, during which the market was up almost 8x!
- Price Corrections (a 10% decline in the index level) happen, on average, every 22 months. We usually don’t even make it 2 years without a bumpy drawdown.
- There have been 8 US recessions since 1970 an average of 1 every 6.6 years.
- This period of time is littered with headlines both bad and good: terrorist attacks, war, natural disasters, the birth of the personal computer, the fall of the Berlin Wall, and the invention of the iphone. But the point is that the market perseveres.

We find ourselves in a time where things are generally ok… Equity markets are positive, US GDP growth is positive, unemployment rate is still really low. We are just experiencing a lot of mixed signals which can sometimes be confusing and unsettling for investors.
Headlines cause short-term movements

- 2023 was a great year but it wasn’t a straight line to +26%.
- Also, when stock prices advance a lot, they take a breather. And that’s what we saw with the market in April.
- Think of headlines as tea leaves. Don’t look at any one of them as the thing that’s going to change everything.
- Staying invested is the most important thing you can do.

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