Alan Steel
01506 842365
MENU
  • Home
  • About Us
    • Close
    • About Us
    • What We Do
      • Close
      • What We Do
      • Our Services
      • Our Philosophy
      • Our Awards
      • Our Reputation
    • Who We Are
      • Close
      • Who We Are
      • Meet the team
    • Our Approach
    • Financial Planning
  • Testimonials
  • Investments
    • Close
    • Investments
    • Investment Advice
    • Portfolio Building
  • Pensions
    • Close
    • Pensions
    • Retirement Planning
    • Early Retirement
    • Pensions as simple as...
  • Tax
    • Close
    • Tax
    • Tax Advice
    • Tax Planning
    • When I'm Dead and Gone
    • Inheritance Tax
    • HMRC Digital Accounts
  • Insights & Media
    • Close
    • Insights & Media
    • Letters from Linlithgow
    • Informing You
    • Letter from America
    • See us in the Press
    • Master Investor
    • Points of Few
  • Contact Us
Independent financial advisers founded in 1975
Over £1.4 billion client funds under management
17 industry awards for advice since 1989

By Mike Williams, Genesis Managing Partner

Founder and Managing Partner of Genesis Asset Management, New York

Letter from America

The Biggest Risk to Your Investments

By Mike Williams | Monday, 25 October, 2021

The lessons learned over 40 years in this business tend to repeat in a never-ending process.

Take last year as an example, when the haze of COVID and its related shutdowns was still very thick.

The markets “topped” on September 2nd – spending until early November meandering back and forth in a “frustrating” trade range.  

It was the season as they say.

Impatient investors squirmed with each headline; certain the floor would soon drop out.  

This year, the markets also “topped” on September 2nd, and have spent the last several weeks chopping through a very frustrating trade range.  

Folks, there’s nothing wrong.

It’s just building up energy for the next leg of the journey.

This is the rhythm of the market.  

The Real Risk…

The chop, market mayhems, flash crashes, Wall Street gibberish, volatility, and a myriad of economic troubles presented with ample media garnish, is NOT risk.  

They are normal.

The patient investor wins over time.  

The impatient very often sadly lose.

The real risk?

Time. 

The time it takes to learn how wealth is created.

The time it takes to plan, review, and stay on the track of your goal.

And the time it takes to recognize something frustrating but true: that staying the course works better than concerning yourself with all the benchmarks and meanderings.

Sometimes the biggest risk to your investments is you.

The Crunch

And the latest market monster?

Inflation. 

It’s been released by the COVID shutdowns.  

Governments are also cyclical beasts. They make seemingly effective decisions, then set orders, then create compliance, then realize there are unintended consequences.

And round and round they go.

There are now over 100 ships with goods to unload sitting outside America’s west coast ports, and even more to boot on the east coast.  

Collectively, over 200,000 trucking / shipping containers stand waiting to be offloaded and moved around the country.  

So, if you fear that we are going to get less busy on the way to the new normal, then failure awaits you.

The end of this crunch will be helped along significantly the moment Washington DC decides it would like to stop paying people to stay home.  

Thereafter, the “bell curve” of cost pressures that we’re being told is the inflation bogeyman coming alongside the grim reaper is instead just a “time and balance” issue, and not a permanent pathway to Armageddon.

It WILL help drive more and more manufacturing and supply chain elements back to our shores – so there is a silver lining.

Patience Works…

This time next year, we will be glad that our US Federal Reserve did not jump the gun.  

Think about how many government officials, sans the silver spoon mob, got rich from being in business?  

Very, very few.  

Most got rich from a career in “public service.”  

There’s no business experience to guide their crystal balls. 

Meanwhile…

There are strong earnings, records, and new highs on all fronts

Note the 2022 and 2023 data points (above).  

When the time comes, you will be told by experts that the 10% growth rates will be “bad” for us – compared to 2021 numbers.  

And you will be told it is a slowdown and impending recession awaits.  

That will be wrong.

Records will still be getting set – and life will be improving all around us in so many ways it will be hard to count.

Buckle up, folks. 

Sometimes the ascent out of these base camp trade ranges can be messy.

©2022 Alan Steel Asset Management Limited is authorised & regulated by The Financial Conduct Authority. Please note that the Financial Conduct Authority does not regulate some forms of tax advice. Company Registration: SC58014

You should remember that the value of an investment and the income from it could go down as well as up. The return at the end of the investment period is not guaranteed and you may get back less than you originally invested.

The investment services and/or investments referred to in this website may not be suitable for you. If you are unsure we suggest you contact us to discuss matters further. If we believe our services are not right for you we will tell you.

When investing money, whether for income or growth, you are placing your capital at risk as the value of investments may vary, so you could get back less than you started with.

The Financial Conduct Authority does not regulate Tax Advice, Trusts or wills. Alan Steel Asset Management Limited is authorised and regulated by the Financial Conduct Authority. The guidance contained in this website is subject to the regulatory regime of the UK.

The Financial Ombudsman Service (FOS) is an agency for arbitrating on unresolved complaints between regulated firms and their clients.

FOS details can be found at www.financial-ombudsman.org.uk

Alan Steel Asset Management Limited are not responsible for the content of external sites.

  • Cookie Policy
  • Privacy Policy
  • Website terms and conditions
  • Tax Services Privacy Notice
  • Contact Us

This site uses cookies. By using this site you agree to the use of cookies. Read our Cookie Policy