FOMO, and JOMO

During the years 2016—2021, investing was characterized by 2 acronyms—”FOMO” and “TINA.” FOMO— ”Fear Of Missing Out”—caused investors to buy every dip in the stock market. Those years were filled with market drops that were immediately bought. The old cliché that the markets drop like an elevator and rise like an escalator didn’t apply.

This behavior was propelled by TINA—”There Is No Alternative.” TINA was the rational for the FOMO attitude. The idea was that, with interest rates at historical lows over that time period, investing in bonds or CDs or cash were not realistic alternatives. With little competition, stocks soared to heights and valuations here to-fore unseen in modern markets.

Now, everything has changed and we have “JOMO,” - “Joy Of Missing Out.” The 2022 stock/bond market drops were, in my opinion, largely a result of rapidly rising interest rates. “Suddenly” there was/is competition for stocks, especially riskier stocks that take a long time to potentially pay off. For the first time in 16 years, money market accounts, short term T-bills and notes, and most bonds now pay north of 4%. People are “joyful” to miss out on the gyrations of the stock and long bond markets.

Maybe it’s time to look at some new/old ideas. Perhaps 5+% on fixed accounts and stock market strategies protecting as much as 20% to the downside^ would put some joy into your investing world? To learn more, please visit our website and/or call for a 15 minute discussion.