The Muddle Through Ecomony

This is a challenging marketplace for any investor, one that we must just get through.  The term “Muddle Through Economy” comes from an analyst we greatly respect here at, named  John Mauldin.  Mr Mauldin’s weekly email newsletters are sobering, yet optimistic, and I believe he coined that phrase ‘muddle through economy’ about a year ago.  It was prescient description of the ‘new normal’  that we are adapting to- volatile markets, low interest rates, poor prospects for growth, consumer shakiness, few jobs, and eroded savings.

Mauldin does not speak of annuities specifically in his letters, but after reading his compelling analysis, we’re reminded that now more than ever we need to focus on the right combination of SAFETY, FLEXIBILITY, and PROFITABILITY.

With rates low, FLEXIBILITY becomes of paramount importance, as does SAFETY.  PROFITABILITY may need to be sacrificed for the near term.

If you are approaching retirement, you cannot afford to take unnecessary risks.  Doubling down on the stock market to try and recoup losses from ’08 and ’09, is a recipe for disaster.  Take a deep breath, think about the risks, and you may decide it’s better to be safe than sorry- better to have a retirement, even if it’s not as lucrative as you thought, than to risk it all and never be able to retire.

If your pendulum swings to Safety and guarantees, please Contact Us to discuss annuity alternatives.

If your pendulum swings to Flexibility, please consider laddering or balancing your CD’s in multiple FDIC insured accounts, and stay in touch with us for a more opportune moment to enter into an annuity.

And if your pendulum swings to Profitability… Well, please be careful.

What is so refreshing is that Mauldin is an incurable optimist- we share the view that the USA will continue to be the dominant player in the world economy and that our way of life is second to none.  Technology, energy, and creativity are at the root of the American people, and we will emerge stronger in the future.

A great Wall St Journal editorial from the last week of August, ‘10, which I can’t link to as it’s subscriber only content, detailed  how the dominant companies in terms of stock market capitalization did not exist 15 years ago.  What is certain is that American dynamism and ingenuity will create new opportunities, new profits, and new companies  in the years ahead too.  We will muddle through.

Written By

Bryan Anderson

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