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Monday Money Report

| July 19, 2021
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The market set more all-time highs before declining on Thursday with worries of inflation.  Chairman of the Federal Reserve Bank Jerome Powell testified before Congress and reiterated that the Fed is more focused on unemployment than inflation currently.  If the high inflation continues, we may see interest rate hikes late next year.  The jobs report was in line with expectations, setting a post-pandemic low for new unemployment claims. And as earnings season kicks off, stock futures, or bets on where stock prices are going, are up.

I’m sure you’ve heard the advice to “buy low and sell high”.  How can you do that when the market is setting all-time highs?  Isn’t that just buying high? Yes, and no. Yes, you are buying at a market high.  But the comparison between high and low is not between today’s price and last year’s price. The comparison is between your purchase price and your sales price.  What did you buy it for, and what did you sell it for.

Yes, we are at market highs.  The question becomes, “Do you believe that the free market, or free people making choices to purchase – or not – goods and services offered in the marketplace, will continue to grow?  Or, do you believe we’ve reached our maximum economic heights, and innovation, productivity and efficiency gains are all behind us?”

Either way, since World War II, buying into the market at a record low has led to average returns of 11.5%.  Buying in at a market high has still resulted in average gains of 9.6%.  The biggest determinants of your success as an investor are three-fold: establishing a portfolio that is aligned with your goals, sticking with that plan, and the amount of time you have. 

And by the time you hear this, I will have just returned from three days hiking in Shenandoah. And that’s your action item for the week.  Get out for a walk, preferably in one of the many parks we have locally.  Your physical, mental, and fiscal health are all connected.

And don’t forget to check out our website at covingtonalsina.com and our Facebook page. 

Securities offered through LPL Financial, Member FINRA/SIPC. Investment advice offered through Great Valley Advisor Group, a Registered Investment Advisor. CovingtonAlsina and Great Valley Advisor Group are separate entities from LPL Financial.

All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly. 

The opinions voiced in this show are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which strategies or investment(s) may be appropriate for you, consult with your attorney, accountant, and financial advisor or tax advisor prior to investing.

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