Buckle your seatbelts

“There are a number of plausible paths to having…a softish landing.”

Federal Reserve Board Chairman Jerome Powell, quoted in a 5/17/22 MarketWatch article. Addressing concerns that raising interest rates too far too fast may tip the economy into a recession, he compared what may be ahead to a turbulent airliner descent in preparation for landing. “Sometimes it’s just a little bumpy. It’s still a good landing." At the same time, Powell said no one should doubt the Fed’s anti-inflation resolve. “What we need to see is inflation coming down...and we’re going to keep pushing until we see that.” Read more at on.mktw.net/3PKeF0n.

Just don’t do it

“Pursuing most likely, positive outcomes is a terrible investment strategy if the impact of less likely, negative outcomes, is catastrophic. And that’s exactly the type of potential negative outcome that market-timing delivers.”

– Rubin Miller, in a 5/24/22 post on his Fortunes & Frictions blog. He explained why you probably could time the market, and why you definitely shouldn’t try. Read more at bit.ly/3Gk3k2O.

Many will still try

“Market timing is impossible, and this fact does not change during a bear market. The only difference is the attraction of attempting it when portfolio values are falling can become overwhelming, and the damage it inflicts will likely be greater than usual.”

– Joe Wiggins, in a 5/24/22 post on his Behavioral Investment blog. He called attention to some of the many unique and self-defeating temptations brought on during a down market. Read more at bit.ly/39WWpQM.

Knowing what we don’t know

“I don’t know what’s going to happen for the remainder of 2022. It wouldn’t surprise me if things got worse. It wouldn’t surprise me if things got better. This might sound like a cop-out but I’m long humility right now because things are so confusing.”

– Ben Carlson, in a 5/22/22 post on his blog, A Wealth of Common Sense. In a world filled with market prognosticators who profess to know exactly what’s coming next, it’s refreshing to hear a respected market analyst acknowledge the truth that no one can predict the future. Read more at bit.ly/38rJLJu.

The all-weather portfolio

“Survival is the most important thing. Your portfolio must be able to weather euphoria, panic, and malaise.”

– Michael Batnick, in a 5/11/22 post on his blog, The Irrelevant Investor. This was one of “20 Lessons Learned” so far during this year’s market downturn. For the other 19, go to bit.ly/3PMmgLO.