Weekly Thoughts 20 Janaury 2017

The year is begun. The season of spending too much has passed. May the year ahead be better for you than the year passed. Some comments from me today after reading opinions from Foord Asset Managers of the year ahead.

They have mixed opinions on the US economy, anticipating steady growth ahead, especially if some of Trump’s promises are fulfilled. However, they see a more uncertain Europe, with quite a few political issues together with Euro and Pound weakness. Then they expect China to continue on the path of economic growth but at a slower pace than past years. For South Africa here at home, they are expecting very little growth.

This – very little growth and hence ‘flat’ markets in South Africa – can always create a beneficial season of investing due to cheaper share prices. To not invest because markets are down, means you’re waiting for them to rise, to get more expensive before investing. Whereas everything else in life that we buy, we’re looking for that thing to be cheap. We want a bargain. Not understanding that we should apply the same thinking to the stock market. This ‘timing’ of the market usually results in the first 20% of the upswing being missed before you put your money in. The first movement usually happens too quickly. So just keep investing, after all, we invest for life.