Why you should you buy stocks despite their all-time highs
PLUS: 🔸 Jacob Rees-Mogg has a bad day 🔸 The luxury watch market is in decline 🔸 "creepy women" are Hollywood's new trend.
Hello! Here’s today’s two-minute guide to demystifying money and making you richer.
Stocks are up — is it time to buy?
Jacob Rees-Mogg's asset management fund is collapsing.
Spotify CFO had a $9 million payday — and lost his job.
Binance founder CZ faces prison.
Elon Musk thinks the CEO of Disney should be fired.
The luxury watch market has gone into decline.
Creepy women are Hollywood’s hot new thing.
Yesterday’s markets:
S&P 500: 4,585.59 ⬆️ 0.8%, ⬆️ 19.9% YTD
FTSE 100: 7,522.90 ⬆️ 0.12%, ⬇️ 0.41% YTD
GBP to USD: $1.26 ⬆️ 4% YTD
GBP to EUR: €1.17 ⬆️ 3.2% YTD
Should you buy stocks at their all-time high? Yes!
🎄 Christmas is coming, the goose is getting fat, and anyone who bought stocks this year is patting themselves on the back. (See what I did there?)
Stocks are nearing their all-time highs. There was a wobble in November for sure but with inflation in the rear-view mirror shares bounced back upwards this month. The S&P 500 is up nearly 20% year to date. The Dow Jones and Nasdaq are all within striking distance of their all-time highs. Germany’s DAX is already at a new record high this week.
Obvious question: Is this time to buy or sell? You have probably heard the usual advice: buy low and sell high. That would suggest you should be offloading and enjoying the cash you just made.
✋ But that’s not the advice we’re going give you at Moneyin2. If you want to build real wealth, you need to be in this for the long-term. We’re talking 20 years or more. If you are invested in the broad markets — an S&P 500 or a NASDAQ exchange-traded fund, for instance — you should not even think of selling your investments until you’ve got enough to be financially independent forever, or when you’re ready to retire.
😴 Say it with us: Only morons try to time the market. You’re going to hear this a lot from us at Moneyin2: Attempting to time the market — selling at the top and buying at the bottom — is for morons. It is impossible to time the market perfectly. In reality, you’re going to make those trades somewhere in the mushy middle. We know this because investment managers who try to pick specific stocks that will outperform usually do less well than the market as a whole.
🔎 Here’s the proof. If you look at this chart of how the S&P 500 stocks did during this year, it sure looks like it is time to sell. Stocks are up, and it was a volatile, risky year. That green line is screaming “cash out” and enjoy your 20% gain:
But now look at how the S&P did over the last 20 years. The market went through dozens of all-time highs. It gained 400%, not including dividends, which means it was worth even more.
Also note, that 20-year line isn’t nearly as CrAzY as the one-year line. Stocks always look volatile over short timeframes but in the long run, they sweep majestically upward.
🆙 Stocks go up. This sounds dumb but it’s one of the most important things you’re ever going to learn from Moneyin2: Stocks go up. That’s it. Yes, they sometimes take a breather but in the long run, they go up. They went up after the Covid pandemic. They went up after the financial crisis of 2008. They went up after the September 11 attacks in 2001. They went up after the dot-com crash of 2000.
Absent nuclear war, stocks go up.
(This central insight, by the way, is how Warren Buffett got rich.)
So yes. If you’re saving for your future continue buying, incrementally, every week or every month.
And for Dessert …
🎧 EY partner thinks headphones are ruining the office experience: Ernst & Young partner David Williams told City gossip queen Sarah Butcher that people using headphones at work are ruining it for everyone else. “You have some people in the office booming out their voices with their headphones on,” he says, and "introverts will run a mile from it."
🇨🇳 Moody’s fears China backlash: Moody’s Investors Service advised its employees to work from home this week after the company cut China’s sovereign credit rating. “They didn’t give us the reason . . . but everyone knows why,” one employee told the FT.“We are afraid of government inspections.”
🎩 Jacob Rees-Mogg's asset management fund, Somerset Capital Management, is collapsing. That sound you can hear is the world’s smallest violin.
🏡 Zoopla says house prices will fall 2% next year. Moneyin2’s advice? Believe it when you see it.
🥁 Spotify laid off 1,500 people but don’t worry about the CFO, who also lost his job. He walked out of the company after selling $9 million in stock.
👮 Binance founder CZ faces 18 months in prison. Yikes.
🤡 Elon Musk thinks the CEO of Disney should be fired for not advertising on Twitter/X.
⌚ The luxury watch market has gone into decline.
👩 Creepy women are Hollywood’s hot new thing. “A spate of recent films revel in their depictions of female characters with sinister vibes and dark secrets—and Hollywood’s leading actresses are flocking to take the roles,” the WSJ says.