If not panic, then certainly a lot of pique!
Selling sometimes begets selling; that is what seems to have been happening recently. What had been an established trading range has now been broken to the downside. We are now in correction territory; something we hoped to avoid. Perhaps it’s good just to get all the negativity out. There is plenty to worry about. However, there is an awful lot of good too.
We still see no risk of a recession for some time yet. Obviously, a left field event can change things, but short of that, economic momentum is good. Unfortunately, we now must worry that stock market volatility and decline will influence general economic behavior. It’s the reverse wealth affect, with consumers and businesses pulling back on their previous plans. It is too early to see that.
Corrections need to play out. The good news is that they do so quite quickly. Never fun, the best course is to do little, upgrade where possible, and set up for the eventual recovery. We are doing just that. Income needs are being met so no reason to join in the panic. Emotions work against good investment practice. Stay steady, my friends.
El Solo Toro