Wednesday, September 18, 2013

Climbing a Wall of Worry

"A bull market climbs a wall of worry." ~ Wall Street adage

In Still Planning for the Worst, I reiterated the four negative factors that I thought would bring the market down and added a fifth negative factor.   With the Fed delay of tapering, all four negative factors are now either neutral or positive.  So only the fifth factor, debt ceiling and budget debates, remains to potentially move the market downward.

Over the past two weeks, the market has responded with upward spikes to the defusing of Syria, Larry Summers withdrawal, and now the delay in Fed tapering to achieve new all time highs. Imagine how the market will shoot up when the President and House Republicans hold hands, sing Kumbaya, and resolve the debt ceiling and budget issues.

Stranger things have happened with Washington politics, but I'm not risking our savings and retirement accounts on the possibility.  Instead, I'm going to continue to expect the worst, and be pleasantly surprised when the factor becomes neutral to positive, as has happened the last four times.

For more on The Practice of Personal Finance, check back every Wednesday for a new segment.

This is not financial advice. Please consult a professional advisor.

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