I don't want to invest my money now because...

Geoff Cook - CFP, CHAIP

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A lot of investors are worried these days and rightfully so, there is a lot of uncertaintly in the world right now. Whats interesting is that there has always been uncertainty and reasons why "not to invest".

I will never forget a point made by Warren Buffet when I saw him speak at The Berkshire Hathaway Annual General Meeting in 2010. When asked how the U.S economy would ever come out of the mess it is in, and if we will ever come out of recession his response was;

"Throughout my investment career there has been 15 recessions. Each time, it feels like it will never end, and investors fly out of stocks."

"These actually present enormous opportunity to those who have a stomach to handle the fluctuations and buy great investments cheap."

"Never underestimate humans ability to innovate and solve problems."


I thought it would be timely to share the following piece...

 (note: In this piece, stock markets have been represented by DJIA which stands for "The Dow Jones Industrial Average")


What we see here is that every year from 1934 - 2011 there was a reason to be worried about markets and valid reasons "not to invest". Throughout this time the Dow Jones Industrial Average grew from 104 - 12218 a whoping 1071% increase.

Now, we still need to be smart about how we invest. We need to buy investments at reasonable prices, invest in industries that make sense, choose suitable investments given our age, time frame and risk tolerance.

Lets not kid yourself...Volatility is here to stay.

I will finish off with one last Buffet quote - "Be fearful when others are greedy and greedy when others are fearful."

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