Spoiler alert fellas: these 3 magic words are not “I love you”. Sorry. But they might just be better. Though you can be the judge of that!
The other day I was at Waterstones and got a rush of investing inspo. I found myself meandering about the biz & finance section. I immediately felt at home. And I stumbled across 2 books – the first was Morgan Housel’s book ‘The Psychology of Money’ (a must-read btw!) and the second (more importantly) was ‘Just Keep Buying’ by Nick Maggiulli.
The title got me hooked! What a clever thing. Obvs, I wasn’t gonna pay £14.99 for it. So I ordered the first book from eBay and am yet to order the second so maybe you can tell me what you thought of it! (Because, right now, I’m too busy buried in romcoms! Make of it what you will…)
But how easy is it to ‘just keep buying’?
Whichever way you look, there’s disaster ripping through financial markets. And you can say it all started with our dear drug (cough, cough low interest rates) being snatched away from us. We got hooked on the stuff. So much so that we’ve got rates at 4% and no one is getting outa here unscathed.
The first thing to cave was crypto. No surprise there. The riskiest assets always drop first – kinda like a bright red warning light! Then came the collapse of FTX, Silvergate, SVB (read all about that here and why you should care) and then Credit Suisse. A systemically important fella. Basically the Swiss guys couldn’t afford for it to go belly-up. So, they literally forced UBS to buy them out. Much like an arranged marriage!
Beyond the banking bomb, tech is having a rough of it too as layoffs keep on coming. Just yesterday, Amazon said they’d be laying off 9,000 more workers. Oh, and that’s after they’ve fired 18,000 workers! Meta’s gone and fired a further 10,000. Though all this is teeny compared to AIG’s layoff of 36,000! 1 in 3 people got fired. Ouch. In Jan, monthly layoffs hit its highest level since 2020.
So this tug-of-war between “we’ve gotta bring inflation down” and “we kinda wanna avoid a recession” is seriously taking its hold. And you know which one is likely! For those who went through the wars of ‘08 and came out the other side, they’ve still got their scars. And what’s going on now feels eerily similar.
But, as the head of AM at my firm reminded us (during an impromptu call to discuss volatility that’s now become a daily occurrence!) that markets overreact to news. This works on both sides: the good news but also the bad news. He told us how big banks (JP Morgan, Citi, Bank of America) are in much better position than they were back then.
But it’s hard for markets to distinguish between regional banking failure (like SVB) and the big boys. And when bank runs happen (which, btw isn’t often!) we all get spooked. Read here why nothing gets us like a financial horror show but why you should never fall for it!
Don’t think twice!
So given all this craziness you might very well think twice (or a million times) before you invest. If at all! But read here why you cannot afford to be covered in cash. And the magic motto ‘just keep buying’ feels a bit silly. At least on the surface.
But that’s how pessimists catch you out. They sound so smart. And trust me, no one sounds smarter than a pessimist in a crisis. But if you stop buying, you’re letting everyone else grab ‘em on the cheap! What a waste! It’s like offering everyone a hot choc chip cookie before grabbing one for yourself. Pure and utter sacrilege.
These 3 magic words (if you actually live by them) will mean you’re not just buying stocks when they’re in-season but when they’re down in the dumps. Like unwanted smelly socks. And buying stocks when they smell like worn socks is the perfect time to grow your wealth.
The thing you gotta know is that stocks ALWAYS recover. It’s just a matter of when, really.
And yeah, sure, markets could go way lower (duh) but they could also go higher! And I dunno about you but I sleep better at night knowing I’m buying near(ish) to the bottom (shame, no one knows where the actual bottom is. Rude.) than buying right at the top. There’s way more downside that way. But it’s hard. And we give the media too much attention. They’re smart. Fear sells. It really does. But it also sells your future.
So fellas, just keep buying. Whether stocks are up, down or sideways. Keep. On. Buying.
That’s how you get rich. Buying when others aren’t, can’t or won’t. I think I need to get these 3 words engraved or hung up on my wall. Either way, I’m gonna force myself to do it. Cuz let’s be real it doesn’t come easily. I mean which crazy person runs into the burning flames when everyone’s busy running for their lives.
And since this is my first bear market – I totally hit the ground running, asking for an easy ride would’ve been too cheeky so I got slapped with it but it’s teaching me damn good lessons. Buying when the bear’s around is a gazillion times easier said than done but it’s the best decision for your future. That’s how to make oodles and oodles of money.
So whatever happens, keep on buying.
I promise you, the world is not going to come crashing down like they say it will.
Oh, and if it does – your silly old smelly stocks will be the least of your worries. Ha!
Disclaimer: This blog is not investment or financial advice. It is my opinion only. This blog is not a personal recommendation to buy/sell any security, or to adopt any such investment strategy. Always do your own research before you commit to any investment.