No Uncertainty in the Short Term

Uncertainty Is Not The Problem  (subscription may be required) by Clifford S. Asness in The Wall Street Journal writes "...our main problem is not the uncertainty surrounding new policies. It is the policies. "  His point is that the businesses' beliefs that the policies are bad is stifling the economy.   The uncertainty of how bad is not having an additional effect.

The same is true for how I'm managing our retirement and savings accounts.  I've have sold the majority of our equity investments not because of uncertainty.   I'm out because it's pretty clear to me the stock market is getting worse and possible actions by the government will make it worse it worse in the short term.   The main uncertainty is how bad, which wouldn't change our actions.

Of course, there is still significant uncertainty about the longer term future, i.e. whether the markets will be continue to be bad.  For now, I'm planning on an improved market in 2012, since the likelihood of reversing existing bad government policies increases as the 2012 elections nears.
For more on  Reflections and Musings, check back every Friday for a new segment.

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

Copyright © 2011 Achievement Catalyst, LLC