“This is a trader's market, because traders love volatility," - WSJ
Two fresh signs of weakness -- a sharp rise in the number of Americans filing for unemployment benefits and a slowdown in consumer spending -- renewed fears about the economy. - WSJ
"In some ways, the ISM (report) is outweighing the jobs number… - WSJ
The stock market is down, the stock market is up, and the stock market is down again. If this is a trader’s market, it certainly makes the rest of us nervous. After a five year bull market, we have been recently reminded that markets and the economy are cyclical.
Investors are watching their nest egg(s) move up and down like a kid’s bouncing ball. You may feel that your financial future is involved in something that you have little understanding of. Those emotions are very real. In the bull markets you feel great; you have the world by the tail. In the bear markets, the world returns the favor.
Why are we so trapped by the ups and downs of markets around the world? For many, it is because of an unrealistic view of what the stock markets can or should produce for their future. Many have an unrealistic image of getting rich quickly, or of easy security. There is for some the thrill of gambling without the guilt.
Can we do anything about these ups and downs? In regards to the market or the economy, no.
However, we can do something about our own personal finances. We can control how we plan for the future.
Jesus tells this story recorded in the book of Matthew that illustrates what our attitude should be: "Therefore everyone who hears these words of mine and puts them into practice is like a wise man who built his house on the rock. The rain came down, the streams rose, and the winds blew and beat against that house; yet it did not fall, because it had its foundation on the rock. But everyone who hears these words of mine and does not put them into practice is like a foolish man who built his house on sand. The rain came down, the streams rose, and the winds blew and beat against that house, and it fell with a great crash."
Recently the rains have come down, the streams have risen, and the winds have blown in the stock market. However, with a strong foundation built on wisdom, your plans can weather these storms.
Here are a few rules to follow to help build a solid financial plan. First, tithe; be charitable with what you have been given. The second rule is to pay yourself first. You should set money aside with each payroll, invest into your savings, 401k, or another investment account. Third, don’t buy it unless you have earned it. Do not recklessly use debt. Fourth, have a plan for current bills, future expenditures, eventual retirement, and emergencies. Finally, relax. If you have a solid financial plan built on wisdom you can relax. You must continue to make wise decisions, and you can do so with a solid foundation.
Jesus told this story to illustrate building an entire life on the foundation of wisdom. The financial portion of your life is only one piece. The entire foundation should be Jesus himself.
August 8, 2008
Investment advisory services offered through Sound Financial Strategies Group, Inc.("SFSG"), a Registered Investment Adviser. Securities offered through Comprehensive Asset Management and Servicing, Inc., ("CAMAS") Member FINRA/SIPC. SFSG and CAMAS are separate and unrelated companies. The opinions voiced in this article are for general information only. They are not intended to provide specific advice or recommendations for any individual and do not constitute an endorsement by CAMAS.
Posted on Fri, August 8, 2008
by Chris McAlpin