How Will Greece, China And The Oil Spill Affect Your Bottom Line?

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Tuesday, June 29th, 2010

I’ve been getting a lot of questions lately about the oil spill and the situations in Greece, China and Europe. People are wondering how these events are going to affect the market overall, and their own investments.

I think the whole world is concerned about the financial solvency of the European countries. Our accounts have no exposure to Greece and none of any real significance to Europe, while at the same time profiting nicely from exposure to Asia, including China. So I’d say that’s the good news.

Beyond that, it really boils down to an issue of confidence. Pardon me for getting a little bit political here, but if you want to see what the US might look like in 5-10 years if we keep heading down the path we’re headed, I think you just need to look at (the public rioting) Greece – with the new austerity measures and the government being forced to cut back on services. To be honest, that scares me more than looking at Greece and these other countries from an investment perspective.

But again, the bottom line is our investment system has proven itself – and this holds true with the oil spill as well. Money doesn’t disappear; it just goes to where it’s in highest demand. So if world events change and dictate different investment classes are now favored, that’s where the money goes.

Our system has been able to pick up on changes and trends, and we rotate money to the areas that are in highest demand, while trying to avoid the areas that are in weak or falling demand. That is the beauty of our investment system. It takes everybody’s emotion out of the equation, because everybody will have an opinion. Some people will be right and some people will be wrong. And at the end of the day for us, it doesn’t matter. We just want to know where the money seems to be headed to.

Economics 101: if demand is increasing prices will tend to hold, if not increase. We just want to follow that trend. That’s how we’re able to give our clients the stability they’re looking for in volatile times. And yes, we’ll even go to all cash if our un-emotional supply and demand indicators show that’s where the money is going!

Tags: brian Fricke, certified financial planner, finance, financial advisor, Financial Management Concepts, financial planner, Financial planning, retirement, retirement planning, wealth management