Missoula Financial Advisor’s Message During Market Crash
It’s been a wild ride on Wall Street over the past week with equity markets rising and falling with the rapid rise in interest rates by the Federal Reserve.
Bob Seidenschwarz with S.G. Long in Missoula spoke to KGVO News on Friday after a wild week of reaction to inflation.
“This is the digestion of the interest rate increase of 50 basis points which clearly the Fed signaled would be the case,” said Seidenschwarz. “Clearly they're indicating future increases, which I believe the concern was. We're concerned that these increases are going to be more than maybe anticipated, and that creates uncertainty, Peter and that was the reaction that we saw the other day.”
Seidenschwarz emphasized the point that low inflation is here to stay due to rising interest rates as the Federal Reserve works to avoid a recession.
“This is a message I really want the audience to understand,” he said. “We are going to see inflation stay, it's not going away, and it may get worse before it gets better. There are still a lot of issues here that are at work that are going to have, I think, very consequential impact on what we see going forward. Food prices, rent, obviously oil and gas, everything associated with that are the consequences of Russia and Ukraine are still being digested by the economic and political systems.”
Seidenschwarz had specific advice for those over 65 in dealing with their investments.
“If you're 65 years old, you’ve got another 20 years that you're going to live very likely based on mortality rates,” he said. “Don't be making irrational decisions. That's the worst thing to do, even though at the moment, it's the most fearful part of the equation. It's very hard to reconcile what you're feeling with what your statements are going to look like, but don’t make a bad decision that's going to impact you in the long term.”
Seidenschwarz said when the market drops dramatically as it has in the past week, it can also be seen as a buying opportunity in anticipation of future gains.
“The key here is education and having a conversation and this could be with your Schwab advisor or your advisor down here at S.G. Long or at D.A. Davidson or any number of places. This is what we do for a living. This is the perspective that people at least need right now. And that's why people in my business should be active in terms of contacting their clients and not waiting for that call themselves.”
For 2022 the Dow is down nearly 10 percent, the NASDAQ is down 22.5 percent and the S&P 500 index is down nearly 14 percent.