Financial Planning

Yesterday was a dark day for our country. I watched in horror as an angry mob stormed the Capitol Building, besieging the capitol police. Certifying the Electoral College votes is typically a ceremonial event, administered without fanfare, but not yesterday as rioters forced Congress members to put on gas masks and flee the chamber. The last time unruly thugs stormed the Capitol Building was 1812, 209 years ago.

After years of investing prudently, following his plan, and spending wisely, a young ruler was ready to retire and enjoy the fruits of his labor. He met with his trusted advisors to see if it was feasible. They affirmed his decision, and congratulated the young ruler on his accomplishment, and wished him well.

This year felt like a decade. We are twenty days from the start of a new year, and it can't get here fast enough. I'm expecting next year to be much better because it can't get much worse – right? It's been a wild ride for investors this year, but if you stayed the course, you probably made money. The NASDAQ, S&P 500, and Dow Jones are solidly in the green, despite falling more than 30% in March and April.

During the pandemic, I spent considerable time reading books. I enjoyed the list below and learned much from the authors; though not ranked in any particular order, they could be.

Bubble in the Sun: The Florida Boom of the 1920s and How It Brought on the Great Depression – Christopher Knowlton

A few individual stocks are soaring this year, like Zoom, Peleton, DraftKings, Pinterest, and Bill.com – each one up more than 225%, with Zoom leading the way, rising almost 500%, far outpacing the Dow's gain of 7.75%. It seems logical to sell boring index funds to buy high flyers; after all, who wouldn't want to earn 500%?

It's the season of Wall Street predictions, so I'm throwing my hat into the ring to offer 21 projections (guesses) for 2021. If I predict all 21 correctly, I'm sure to garner immense fame and fortune. I may even be herald as the next great futurist with book deals, movie offers, and television appearances to follow. If I'm wrong and all my ideas fail, there's no downside because most forecasters are wrong about the future.

The Miser is a classic Aesop Fable. It's a story about a man who buries his gold under a rock. He visits his gold stash so often that a thief follows him and steals it. The miser is distraught when he realizes it's gone, though he had no plans to use the gold to buy things. A lot of us are probably like the miser in the story. We check our investments daily to make sure they are safe and sound, but we don't intend on using them to purchase anything.

A young ruler owned several racehorses. His stable was full of powerful thoroughbreds, but one yearling stood out from the others - a beautiful chestnut with a wide blaze. It had an easy gait and ran like the wind while galloping. The young ruler was mesmerized.

The Hare and the Tortoise is a classic Aesop fable. A story we know well.  The hare mockingly asking the tortoise, "Do you ever get anywhere?" Of course, we know how the story ends. The tortoise "kept going slowly but steadily, and, after a time, passed the place where the Hare was sleeping." Practicing a life of slow and steady is harder than it looks. We are an impatient nation addicted to getting our way as quickly as possible.

I like math. It's pure and definite; the answers are indisputable. In junior high and high school, I had spirited conversations with my English teachers because our interpretation of events differed considerably. It was my opinion against theirs, and they frequently won because they were grading my papers. However, I always felt a little cheated because if they didn't like my topic or handwriting, they'd knock me down a notch or two.