Keep Calm and Stay Invested

The sun will rise again.

Sunrise from space. Source: NASA

That’s what I thought this morning when I read the headlines. Lots of folks – both left and right – are freaking out. I can’t comment on social or political issues – they’re outside of my zone. But I do have one suggestion for investors: stay calm.

When President Obama was elected a lot of people on the right expected that higher taxes and greater regulation would damage the economy. And we saw higher taxes and greater regulation. But the economy still grew. Yes, Trump is anti-trade and anti-immigration, both of which benefit the economy. That’s why almost no economists endorsed him. But the Office of the President is bigger than the person who occupies it. Trump will be constrained by Congress and the Courts. We’re still a narrowly divided nation. Hey, maybe we’ll think seriously now about limiting executive power, the way the Constitution intends.

Source: NY Times

What matters most to markets is company earnings and their long-term growth. Wars, revolutions, cultural shifts, and technological changes have a much bigger impact than politics. Regardless of your political views, life will go on. Governments intervene in their economies. Governments go to war. Governments make policy errors. If you’re a long-term investor, those errors are typically corrected in less than a generation.

We’ve gone through invasion, civil war, depression, and terrorism. The Republic will survive. And I expect the sky to still be blue.

Douglas R. Tengdin, CFA

Chief Investment Officer

By | 2017-07-17T12:21:37+00:00 November 9th, 2016|Global Market Update|0 Comments

About the Author:

Mr. Tengdin is the Chief Investment Officer at Charter Trust Company and author of “The Global Market Update”. The audio version of each post can be heard on radio stations throughout New England every weekday. Mr. Tengdin graduated from Dartmouth College, Magna Cum Laude. He received his Master of Arts from Trinity Divinity School, Magna Cum Laude and received his Chartered Financial Analyst (CFA) designation in 1992. Mr. Tengdin has been managing investment portfolios for over 30 years, working for Bank of Boston, State Street Global Advisors, Citibank – Tunisia, and Banknorth Group. Throughout his career, Mr. Tengdin has emphasized helping clients manage their financial risks in difficult environments where they can profit from investing in diverse assets in diverse settings. - Leave a comment if you have any questions—I read them all! - And Follow me on Twitter @GlobalMarketUpd

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