My World and Welcome To It

Boy, has this been a quarter.

After yesterday’s action the markets are down about 13%. That’s the worst quarterly return since 2002. Indeed, over the last 70 years, the market has declined more than this only 13 times. That’s a telling statistic. Because while declines of this magnitude are unsettling, they’re not unprecedented. In fact, they happen every 5 years or so.

Make no mistake: the current downturn is a made-in-Washington affair, with politics trumping policy and radically mixed signals confusing the markets. Add to this an unpopular lame-duck administration that doesn’t have the political capital to push through bold measures to add to our financial capital, and we have a witches-brew of double trouble.

But witches warnings are dangerous signals to run by. Over these same 70 years, if you bought into the market after each of these large quarterly downturns, you would have received a 13%  return over the next 10 years. Just living through the waves give you an 11% return.

Because the world has a way of not ending. Whether it was Pearl Harbor, Nixon’s resignation, or the Enron debacle, the fundamental factors that caused the market’s decline were overcome. But our economy recovered, and investors with staying power profited. Yes, you can.

Douglas R. Tengdin, CFA
Chief Investment Officer
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By |2014-09-03T21:17:46+00:00September 30th, 2008|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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