Just stick your money into an index fund and you’ll retire comfortably: that’s the cliché we hear from money managers and old-school investing commentators all the time. That might have been true at one time in history, but can we continue to count on the stock market to deliver us a comfortable retirement?
Over the past 115 years, many monetary experiments have been implemented by the FED’s officials, but, to me, one quote says it all: “Permit me to issue and control the money of a nation, and I care not who makes its laws!”
The stock market does not represent the real economy in a perfect fashion. Rather, it is sentiment, momentum or the lack of alternative opportunities that can cause rising or falling prices.
It’s unfortunate, but true: most investors only take a stake in their home country’s economy, which is a grave error because a truly diversified portfolio is international in scope.
It’s funny how things work. Yesterday, FED chairman, Jerome Powell, officially stated that the economy is slowing, just three months after he claimed it was healthy, strong, robust, and any other word that his $2,000/hr statement writer manages to cook-up.