Is Good News Bad News for Investors?

Can the economy grow too quickly?

Can the economy add too many jobs?

Is fast wage growth something we want to avoid?

Might there be too few layoffs? 

It’s a Wall Street vs Main Street argument.

Explosive growth benefits Main Street, but it can prompt the Federal Reserve to tighten monetary policy by raising interest rates.

While the threat of higher interest rates may create a more cautious mood among investors, it doesn’t mean economic growth will stall.

Investor’s corner

While we know that past performance is no guarantee of future results (and each economic cycle has its own peculiarities), a series of nine quarter-point rate hikes during the last cycle failed to stop the bull market.

Investors kept one eye on interest rates but also warmed to the expanding economy.

In fact, modest increases in interest rates, in response to a growing economy, have typically not derailed a bull market.

That doesn’t mean we can’t see pullbacks and temporary volatility, but a well-diversified financial plan helps manage risk and reduce overall volatility while keeping you on a path toward your financial goals.

Created 2021-06-24 14:43:56