I like this post from Josh Brown about the inevitability of the market cycle and learning to love it. If there’s one thing that’s certain in the investment world it’s that markets cycles never really change that much. The market spends most of its time fooling most of the people most of the time. Just when you think you’ve got it figured out it does exactly what you wouldn’t expect. Guys and gals have been trying to figure this puzzle out for centuries. So, rather than let it eat you apart, learn to love it:
“The next crisis is coming. The seed has already been planted in some remote corner of the financial realm.
That seed is germinating deep beneath an obscuring layer of thick, black soil.
It will sprout and be ignored someday soon, breaking just above the surface while the people walk by obliviously.
Then it will be noticed and denied, dismissed as unimportant.
Then it will shoot skyward, its dense canopy blocking out the sun.
Then we will all acknowledge it as being the major risk – we will become convinced that it will get much worse and we will all be doomed.
And in that moment, the risks of that crisis will have become too widely acknowledged to pose any actual danger. And just as always, the arrival of this new crisis will have opened up a massive opportunity for those who’ve kept their heads.
This process will play out repeatedly for the rest of your life. Learn to love it.”
Read the full piece here.
Mr. Roche is the Founder and Chief Investment Officer of Discipline Funds.Discipline Funds is a low fee financial advisory firm with a focus on helping people be more disciplined with their finances.
He is also the author of Pragmatic Capitalism: What Every Investor Needs to Understand About Money and Finance, Understanding the Modern Monetary System and Understanding Modern Portfolio Construction.