The Market and the Next Twenty Years

What expectations do you possess for the stock market over the next 10 or 20 years? Are you anticipating growth? Downturns? Generally flat?

Well, reported by a chart you can see at YourIncomeGuru.blogspot, one thing you should expect for certain is volatility. Think serious roller coaster ride.

What you see is the downward slope of our federal deficit. In other words, our deficit is continuing to represent a larger and larger percentage of our country’s gross domestic product.

Why does this matter to you?

Well, it means that whenever we have recessions in the future, the federal government will have less room to print money to attempt to move the economy back to growth. So you can expect recessions will be deeper.

That, obviously, means that the stock market will fall farther during those recessions, meaning you lose more money in your portfolio. Which implies, in turn, you have that much more to make up for to return to even.

Remember 2008?

Just how long did it take you to get back to even on your losses in just that year? If you’re like many people, here we are five years later and you are finally returning to where you were.

Do you want it to be five years again after the next market “correction”? Or even more?

Markets right now appear to be rolling along reasonably well. They always do before the bottom drops out.

Learn from your mistakes, and get defensive now. After all, the biggest secret to making money is to AVOID the big losses.

Matt Golab

Matt is an Investment Advisor Representative as well as the Chief Advisor of Aaron Matthews Financial Resources headquartered in Elk Grove, California. Simply click right here to find out more about Matt Golab and his company Aaron Matthews Financial Resources!

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