Article by Paul Sutherland
Are todays headlines distracting to investment decisions and insignificant to long-term investment results? Looking back on headlines of old, it seems to be true.
For example, remember Y2K? How about the hyperinflation of the late 1970s/early 1980s? The crash of October 1987? The Nifty Fifty of the 1960s and the subsequent 50% crash of 1973-1974? 0 gold in 1980? 0/barrel oil? Ayatollah Khomeini? Saddam Hussein? Manuel Noriega? Tiananmen Square? September 11? All of these were reasons to freak out about ones investments, yet none caused long-term or permanent damage to capitalism or investing success or wealth management. Inflation, deflation and devaluation are all normal phases of economic cycles. We have experienced periods of all three (as well as events like those noted above) over and over again throughout history, and frankly this (current) environment is not particularly unique.
Skilled investing requires the ability to see the world for what it is. Investors must separate emotion from logic, or perception from reality, and identify opportunities and risks in order to take thoughtful, wise and seemingly brave action. Each of these conditions created opportunities for those able to identify and willing to capture them. In the words of Sir John Templeton, one of FIM Groups frequently quoted mentors, People are always asking me where the outlook is good, but thats the wrong question. The right question is, Where is the outlook most miserable?
» Read more: Long Term Wealth Management Results and Todays Headlines
