I’m scared of the stock market with its wild peaks and valleys of late. But I’m also reluctant to get out.
Where else do you put your money? I don’t know.
So I’m like a passenger on a small vessel in stormy seas. I’m trying to stay aboard, not get seasick, and weather the storm until we get to calmer waters. It’s an unpleasant journey, but I’m committed to it.
Recently, a friend recommended a new investment book. It’s called Debunkery: Learn It, Do It, and Profit From It – Seeing Through Wall Street’s Money-Killing Myths. It’s written by Ken Fisher, a widely known investment manager who writes a regular column in Forbes magazine.
Normally, I don’t read financial advice books. I don’t have huge sums to invest and I don’t have the patience to try different strategies to grow my money.
But with the stock market beating me to death, I thought I’d see what Fisher had to say. The 234-page hardback is accessible and straightforward – unlike some arcane investment books.
It has 50 chapters – each devoted to a piece of investment bunk, according to Fisher. Some examples: Bonds are Safer Than Stocks, Retirees Must Be Conservative, Trust Your Gut, and Dollar Cost Averaging – Lower Risk, Better Returns.
I’m an investment novice, but I’ve heard each of these financial maxims. And Fisher says they’re wrong. I’m intrigued.
He has a chapter on the current gold madness, a subject I wrote about recently. I’m not jumping on the gold bandwagon, despite claims that it’s the best hedge against inflation and financial instability.
Fisher confirms my view.
“Gold fades in and out as a hot investment,” he writes. “Gold is a commodity. An investment class like any other. There’s nothing inherently special about this metal making it immune to losses. Gold as a safe harbor is bunk. Sometimes it rises. Sometimes it falls.”
What about bonds being safer than stocks? I’ve always heard and believed this.
“Yes, stocks can be pretty darn volatile and scary – near term,” Fisher says. “ But people forget: onds do sometimes lose value in the near term too.”
He continues, “Stocks are more consistently positive than bonds historically – given just a bit of time.”
Fisher’s advice is easy to digest. The chapters are no more than five pages long, and his arguments are sound and persuasive.
I’ll never be a stock market expert. But I feel a little more confident and reassured after reading Debunkery.
I plan to stay on the stock market ship, although I don’t always enjoy the ride.
No investments, including stocks, are completely safe. But Fisher makes a compelling argument that the stock market is the best place for many people to invest.