Too Far Too Fast? No we are not talking about politics or social media we are talking about the stock market.

Have we gone too far too fast? This seems to be a common investor question. This question concerns the market increase from the lows of March ‘09 to the end of the year which moved up roughly 65%. The 65% increase is not so much irrational exuberance as it is the result of unrealistic gloom from last March. That market was reflecting unreasonable valuations that had many blue chip companies trading below liquidation value. It may feel like to far too fast that way but we shouldn’t invest on our feelings; rather, we invest because we want to accomplish our long term goals of retirement, freedom, and security. In historical context we have not gone too far too fast. We are in the 10th month of a bull market and the S&P 500 index is up 65%. Historically the average bull market has lasted 68 months and has gone up 176%. So rest assured there is still plenty of time to get in. The beginning returns of a bull market typically see the largest increases just moving back to more fair value pricings. If you are waiting for a big pull back to invest, when do you invest? What if the pullback never materializes? The stock market both here and abroad will take breathers now and then but no one knows where and when with exact precision. The best way to ensure participation is to stay invested and the best time to put money in the market is when you have it available. We readily acknowledge there are risks to growth. We are in uncharted territory which puts policy makers in the undesirable position of experimenting. This means there are opportunities for mistakes. But the 14 trillion dollar US economy is just too big to kill even with a variety of policy mistakes. If the economy grows at a conservative rate of 4%, enough health should be provided to the system to start driving down the last part of the recovery which is unemployment. So what is the answer to the question have we gone too far too fast? For politics it depends on which side of the aisle you sit on. For social media it depends on your age For the stock market the answer is no we have not gone too far too fast.

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Rebecca Kennell is a Registered Representative and Investment Adviser Representative with/and offers Securities and Advisory Services through Commonwealth Financial Network ®, Member FINRA, SIPC, a Registered Investment Adviser. Custom Financial Design is located at 4647 North 32nd Street, Suite B210, Phoenix AZ 85018 (602) 952-5588

Contributed by Mario Romero, CRS, CDPE, CLHMS
602-252-4191 office, 602-254-9810 fax
The Romero Team - Melcher Agency
www.TheRomeroTeam.com
www.ShortSaleTeamAz.com
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