Passing the Peak
By Monday what I’m about to write may prove to be totally off the mark, but right now it feels as if we have passed the peak. It actually feels like we have passed many peaks, and seem to be in a perpetual state of passing peaks. The peak that just registered this last week was in financial assets and cryptocurrencies.
We seem to be witnessing a market correction in equities, and the beginning of a bear market in crypto. As someone who never had much in the way of assets to invest in either of these classes before their huge run-ups, this is somewhat welcome. Maybe I will finally get a chance to ride the next wave. I missed this last one, but in order for me to invest in the next one, the last one had to crash down, and that has taken far longer than I think just about anyone imagined. But it’s also sad to watch. My own psychology with the markets these past days has befuddled myself.
Rather than being upset, I was neutral to almost happy to see the value of my own assets drop off a cliff this last week. While others are seeing their losses, I am seeing an opportunity to finally buy in. It is as if maybe, one day, I’ll get to participate in all of this. I suppose I’ve been around for enough cycles now that I know this last peak probably won’t be the all-time peak. I mean, maybe it will, if the world ends, or war begins. Though if that happens, I’ll have far more to worry about, if I’m lucky enough to still have the ability to worry at all. But it’s still all a bit bad, too.
Decline is never pretty. It’s clear our economy is teetering. I used to wonder what it would be like to experience inflation. There has hardly been any inflation throughout my entire life. I knew it would one day come, but simultaneously felt as it never would. Now it’s here, and I don’t like it.
Inflation sucks. But it’s an inconvenience for me, while it’s life-altering for others. People, including many of own friends, are really struggling. Wages are mostly flat but with everything being more expensive, people who were once getting just fine are now simply not. Inflation is part of why asset values went up so much. Now, assets are dropping, but inflation persists. We’re walking into a double whammy. We need not have a dramatic economic downturn for this confluence of economic strains to take its toll. For that, I am doing my best to prepare.
The preparation is more mindset than anything else. Rule one is the help the others I care about who need it. Right now, I’m okay. I couldn’t have timed my investments worse, but I’m still okay. I’m one of the lucky few that is still thriving, if less than I otherwise would have been. Rule two is focus on opportunity over losses.
There will be more peaks, higher than the last. Well, until there aren't, of course. For markets and empires alike, there will always been ups and downs, and none will last forever. Perhaps rule three, then, is to not worry too much about any of it.