January Tumbles Downhill
What a wonderful way to start the year. It’s January 23rd. The portfolio is in the red by $5000, stocks and crypto combined. The market has been on a downward trend which started with valuations at all-time highs was spoked by ever-increasing inflation which could only lead to a rise of interest rates by Jerome Powell. Inflation never inflected down, the FED started to taper at a faster and faster rate. The market expected two to three rate hikes this year. Starting in most likely March and then August. I think that seeing as Powell was slow to raise rates, to begin with, he will want to see what happens to the market before raising rates more than twice. But then, boom! Netflix earnings. The earnings were not the problem, the forecast was. Slowing growth at Netflix gave investors a little taste of what earns season might be like and it didn't go over well. This is where we sit now.
S&P 500 -%9. NASDAQ -%15. Rusell 2000 -%19
So what's the plan. I can’t see things getting better for the next couple of weeks. Why? There’s a catch twenty-two. Bad earnings season, the market falls but maybe fewer rate hikes. But. Good earnings season, Powell raises rates, the market falls. As I am well aware at this point I am no pro-investor. So as much as I would like to sell everything and re-buy low because I am almost certain that's where we are going I just don't think I would be able to time the market twice and I can't bear to see myself lose more money because that's not the fucking reason I am doing this. So the plan is to stay patient, get as much cash as I can afford into my accounts and start buying after all-time lows or at the end of February to mid-March.
There is nothing I can do about hard times in the market except try and make progress. I am three weeks into my real estate course and am still enjoying it and the options it gives me in the future. I have done more to automate my growth of wealth such as setting up auto deposits of $50/week to both my TFSA and RRSP. I will also be contributing at least $100/month to my emergency fund (earning a %1.25 interest) which I would like to grow to $6000 by the end of 2022.
Things will be bad for a while but I enjoy the opportunity to buy great companies at a better price. In the meantime, I will continue to learn and educate myself through books, podcasts and youtube. I am excited to see what the rest of the year has to show, in the market and my life.