Ease the pain with some musings in a philosophical key
USUALLY, whenever I go on holiday, the market falls over; although I met another broker recently who reckoned the market fell over whenever he went on holiday.
Turns out that, whenever anyone went on holiday this year, the market fell over. So it wasn't my fault after all. Hopefully when we go on holiday this time we'll come back having missed a 20 per cent rally. No one will mind that.
Sam and I were thinking of ways to make ourselves feel better about what has happened to us financially. We came up with a few manipulations you might be able to use on yourself. See if you can ease the pain with any of these humbling thoughts.
■ It could be worse — We have seen some real financial carnage from our spot in the market. When you work in the market with people who live and breathe the market, the average return on the market is a bit irrelevant. There are people here with huge exposures to specific situations, not just stocks, but businesses, jobs, opportunity and ambition. Some have been destroyed and would envy those who have suffered no more than a setback. The first message is that if all you lost was the average return on the market, you are half-blessed.
■ Blessed — If you did better than the average market return, you are blessed.
■ Income — A lot of retirees are looking at the dwindling income on their cash as interest rates fall. It is obviously stressful having to re-budget and this year it is likely to be even more confronting. There isn't much consolation. But it will not go on forever; and, if it does, don't worry — everything is going to be getting a lot, lot cheaper. You won't need as much income. And for those of you in cash, just thank your lucky stars you haven't chewed yourself up in the equity market. Some people have.
■ Blame — Everyone is trying to do their best for their families and their futures. To be tripped up on that mission by the worst market performance in living history is unfair and unjust; but, let me tell you, it is also blameless. No one,
not the kings and queens, presidents, central bankers, regulators, CEOs, strategists, economists, gurus, experts or your mates saw this coming. So, what chance did the rest of us have? None. You are not to blame and nor is your spouse or whoever has been burdened with your family's investment responsibilities. The market is to blame. There's some solace in that.
■ No regrets — As we enter the new year I, for one, will be doing a bit of budgeting. Part of that process is "acceptance". We've all had things happen to us in life that we have struggled to live with. Things that, if allowed to roam free, can plague the mind and affect our every mood. In the holiday it will be all too easy to let the financial experience of 2008 roam free and spoil things.
But I have learnt in my old age, and in a busy family life, that the most important thing is "now", the kids and my beautiful wife, and in that privileged environment a moment lost to regret or anger over the past is wasted. As we move further into 2009, I will have to come to terms with 2008 and its impact on my financial situation and have no choice but to see that as the base on which I have to build with a new strategy. There is no other choice.
This year, that net worth calculation and what "could have been" will be done, discussed and accepted, and I move on. I cannot use it as a basis for being annoyed, upset and grumpy. It serves no purpose, my kids won't understand and it wastes the few days I have left on the planet for me and those in my company. You lose more than money if you waste time.
We have to "accept" 2008 as soon as possible. It is done. Next. Move on. The past is past. Time to plan how to build on the "now".
Whatever this year brings financially, our most important assets are those sitting at home. Money doesn't change that and we must not let it change us.
No comments:
Post a Comment