Here is what we don’t and can’t know:
- An acceleration in inflation is a distinct possibility as the economy continues roars back – particularly given another jolt of stimulus.
- We don’t know for sure that it will happen, when it may happen, nor the extent to which it may go on before the Fed steps in and acts to stabilize it.
- Nor can we be sure how (or even if) the equity market will react.
Here is what we do know:
- We know your goals and the plan designed to achieve your goals.
- We know that the true risk in investing is not loss of principle, rather it is the loss of purchasing power due to inflation.
- We know that the only way to eliminate this risk is through the utilization of equities.
Our approach has always been: first set goals, then make a plan, then fund an appropriate portfolio. If your long-term goals have not changed, then we always strongly recommend not changing your plan, which in turn leads us to recommend not tinkering with your long-term portfolio.
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