Oakland, CA | East Bay; July 2022 Update – Time to Invest Cash Off Market Lows?

We’ve been holding much of the large pools of cash given us by clients over the last 6-9 months, but started putting decent sized chunks to work, for the long-term, over the last two days.

U.S. stocks hit a low on June 16^th and we’ve been in decently sloped uptrend since, clawing back to a positive (as of this moment July 22 at 11:35am) adjustment of 7.50%. The low was around a 20% drop from the high for large U.S. stocks, what’s considered a bear market.

Volatility has receded by about 30%. We got the June inflation number, not good, but there are indications the economy is slowing but labor markets remain pretty solid.

These forces, along with reduced liquidity and some drop in commodity prices (among other things), may help to get the economic ship set on a better more sustainable course (lower inflation) without The Fed needing to go too far in interest rate hikes and thus forcing a recession (we may actually already be in what will later be measured as a recessionary like environment).

For long money, if we stay out until markets have completely recovered we’ve missed part of what makes up the long run average we expect in stock returns. Another way of saying this is it if we’re not invested it’s very possible we’ll have less down the road because we may miss the participation we’d enjoy as things recover. We need to measure current conditions vs. decades of potential return and compounding.

We have to operate given available information.

If you are looking for some financial guidance; whether for a one time financial plan or continuing advice on your investments, we invite you to meet with a First & Main Financial planner for a free consultation. We would be more than happy to sit down with you, assess your situation and review our services to help navigate your financial future.

Thank you,

Erik S. Wolfers, MBA, CFP^®