Man are we glad to see that quarter go into the books. Whew! Ugly, ugly, ugly.
But that’s great. Even the hedgies got clocked – leaving few stones unturned.
We can rattle off all the benefits of lower prices. We can rattle off the huge number of contrary indicators now flashing solid good signs. We can list for several lines all of the sentiment indicators and add high levels of fear as an exclamation point.
Now, though, we get down to brass tacks. Now we face the music. Now, we step into the battlefield of our minds and fight the good fight.
Or do we succumb to the fears of the crowd?
As Mark Knopfler tells us in Iron Hand, “The blood is red, the grass is green.”
Not Sitting Still
T oo many assume that business just hits a hurdle and then sits there – giving up.
We have covered often the idea that it is the very fact we have problems to solve which builds the yellow brick road we travel upon towards our goals. Without things to solve, solutions to acquire, ideas to proceed with – forward movement would stop.
We see that at work in the news daily – but often ignore it.
Just today, GM confirmed over $5 Billion in cash flow savings over the next 3 years given adjustments made internally. CAG followed that up with $300MM in annual savings by moving their headquarters to Chicago! These are not small numbers.
More important they should be positives to embrace. It means solutions are still being born daily. Granted, nothing guarantees a future – but savings of $5 Billion here and $300 million there is a ton better than no steps toward efficiencies at all.
Wouldn’t you agree?
It also shows us that ingenuity is the hallmark of improvement and it is still alive and well. It shows us that we have not arrived at the end of finding ways to get better.
Enough of the rosy stuff – back to the brass tacks.
I recall the morning after the time I saw the first Jaws movie.
It was a Saturday. I was in a Hobie 18 – fast boat – racing for the weekend in Charleston Harbor. Hobie’s are catamarans…they are beach launched – or hoisted off the end of a dock as one preps for the start.
I recall staring into the water that I had to wade into about chest deep to get to the boat at the end of the dock. No matter how hard I tried, I kept swearing I could see the shadow of a shark.
LOL It is hilarious now – but if you could have felt my heart racing.
Oddly enough, it did not stop there. I was sure all day long that every ripple I saw on the water as the wind kicked in was a shark fin, every wave crest a set of teeth. I was certain that as we laid out over the water on the trapeze, on the windward runs and the reaches, that sharks were circling right below us at all times.
I define this because that is sort of how it feels when one goes into the markets after a corrective wave. One is usually certain the bottom will drop out as soon as the order is filled. The feeling of stepping into quicksand is always present – sure to suck you down and take everything you have.
I suspect I exaggerate a little of course – but not much.
Such is the Pathway
Sadly, the key times in a wealth building plan are those very feelings. It is a required part of the pathway to getting good deals over time. Shark infested waters are normal for these windows of volatility.
Those feelings are mind games – tricks our fears play on us.
They happen at all points in history – which turned out to be good buying opportunities over time. We never recognize them as such while they are unfolding. We are usually too afraid of the sharks. We also see from history that there is no perfection for that timing. There is no “right spot”. There is only a lower average and good value over time.
If you and I were 29 years old – in our first job – still lacking massive amounts of “wisdom” because we had yet to make a ton of mistakes to gain the “wisdom”.
If we were there – and the markets were as they are today, would we say “oh gosh, the rally is already done…might as well scratch any stock market investing for my lifetime – after all, it has already hit its high.”
Of course we wouldn’t.
Mainly because our minds would not have traveled the distance to here. We would not have experienced the thousands of points up and down, the bear markets, the collapses – and all the bad news that went with them. We would not have fears singed into our brains.
Seeing the most recent highs as “it” – and this corrective action as “the big one” is little different from, say, DOW 4,500 (for the first time) and then a setback to like 4,000.
Imagine what our fears would have cost then…
It is in our newest generations. Records will be set. Things will change. Often they will not make sense. The baton will pass. New processes, new technologies, new tools, new ways, new companies, new…new…new.
Those are the brass tacks. Wading in is tough. Controlling the mind games separates those who arrive where they want to end up and those who succumb to constant fear of the future.
We are there…October likely provides an ample window for shopping and building. If you are focused on next month or next quarter – that’s not investing and we are not good traders so we cannot help you.
Years from now however, odds are high that this statement will have been proven correct – even though very tough to handle at times:
Our best days are ahead of us.