May 12

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The Four Most Dangerous Words (When Investing)

The Four Most Dangerous Words

To quote Sir John Templeton, “The four most dangerous words in investing are: this time it’s different.”

Robert Peanuckle

The year was 1930.  Robert Peanuckle had $10,000 invested in the stock market1.  He thought to himself, “We are in the middle of the worst economic Depression this country has ever seen.  This time is different.  The markets are dangerous.”  Robert took the money in cash and buried it in his back yard.  Ten years later in 1940, his $10,000, had he had kept in in the stock market, was worth $11,925.

John Canterbury

The year was 1940.  John Canterbury had $10,000 invested in the stock market1.  He thought to himself, “We are in the middle of World War II.  I better start learning German.  This time is different.  The markets are dangerous.”  John took the money in cash and buried it in his back yard.  Ten years later in 1950, his $10,000, had he had kept it in the stock market, was worth $35,035.

Earl Pickett

The year was 1950.  Earl Pickett had $10,000 invested in the stock market1.  He thought to himself, “The Communists have infiltrated our government.  I’m pretty sure my neighbor Bob is a Commie.  This time is different.  The markets are dangerous.”  Earl took the money in cash and buried in it his back yard.  Ten years later in 1960, his $10,000, had he had kept it in the stock market, was worth $44,694.

Paul Kowalski

The year was 1960.  Paul Kowalski had $10,000 invested in the stock market1.  He thought to himself, “The stock market has been going up for nearly 20 years.  We are due for a crash. This time is different.  The markets are dangerous.”  Paul took the money in cash and buried it in his back yard.  Ten years later in 1970, his $10,000, had he had kept it in the stock market, was worth $21,959.

David Malkin

The year was 1970.  David Malkin had $10,000 invested in the stock market1.  He thought to himself, “This country is falling apart.  Vietnam.  Hippies.  Oil embargoes.   This time is different.  The markets are dangerous.”  David took the money in cash and buried it in his back yard.  Ten years later in 1980, his $10,000, had he had kept it in the stock market, was worth $22,555.

Tom Chadwick

The year was 1980.  Tom Chadwick had $10,000 invested in the stock market1.  He thought to himself, “The Cold War menace is looming.  Nuclear tensions are at an all-time high.   Russian paratroopers could descend from the skies at any time.  This time is different.  The markets are dangerous.”  Tom took the money in cash and buried it in his back yard.  Ten years later in 1990, his $10,000, had he had kept it in the stock market, was worth $36,813.

Wolfgang Applebottom

The year was 1990.  Wolfgang Applebottom had $10,000 invested in the stock market1.  He thought to himself, “Saddam Hussein has us on the brink of war.  Stocks are overvalued.  We haven’t had a significant recession since the early 70’s.  This time is different.  The markets are dangerous.”  Wolfgang took the money in cash and buried it in his back yard.  Ten years later in 2000, his $10,000, had he had kept it in the stock market, was worth $49,907.

Bobby Bickleberry

The year was 2000.  Bobby Bickleberry had $10,000 invested in the stock market1.  He thought to himself, “The tech bubble is bursting.  I’m hearing rumors of a long term recession.  This time is different.  The markets are dangerous.”  Bobby took the money in cash and buried it in his back yard.  Ten years later in 2010, his $10,000, had he had kept it in the stock market, was worth $11,500  (after two of the worst bear markets in U.S. economic history).

Derek Johansen

The year was 2010.  Derek Johansen had $10,000 invested in the stock market1.  He thought to himself, “We just experienced a decade with two historically awful recessions.  I am spooked.  No more investing for me!”  Derek took the money in cash and buried it in his back yard.  Seven years later in 2017, his $10,000, had he had kept it in the stock market, was worth $23,267.

Be Blessed!

Dave

1 – The S & P 500 Index. You cannot invest directly in an index.

Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. Indexes are unmanaged portfolios and individuals cannot invest directly in an index.  Actual results will vary.

This communication is for informational purposes only and nothing herein should be construed as a solicitation, recommendation or an offer to buy or sell any securities or product, and does not constitute legal or tax advice. The information contained herein has been obtained from sources believed to be reliable but we do not guarantee accuracy or completeness. Do not act or rely upon the information and advice given in this publication without seeking the services of competent and professional legal, tax, or accounting counsel.

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