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Examiner
  • Advice to investors: Ignore the drama

  • Do your homework. Have a plan. Don’t get too caught up in today’s headlines.



    Craig Fehr, an investment strategist with Edward Jones, on Wednesday walked through the things – government debt, economic pokiness, interest rates – that investors cannot control.

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  • Do your homework. Have a plan. Don’t get too caught up in today’s headlines.
    Craig Fehr, an investment strategist with Edward Jones, on Wednesday walked through the things – government debt, economic pokiness, interest rates – that investors cannot control.
    “But we can control our emotions and our perspectives,” he told attendees of the Independence Chamber of Commerce April luncheon.
    “Think about why you’re investing, not emotion,” he cautioned.
    Overall, Fehr’s presentation was upbeat.
    “Things are moving in the right direction,” he said.
    He did, however, outline several challenges. He repeatedly pointed out that 70 percent of the U.S. economy is based on consumer spending. Although corporate earnings have rebounded substantially since the Great Recession, pushing the stock market ever higher, jobs haven’t come back and consumers haven’t been spending as freely as many would like.
    “So if we start spending a little less, it’s a self-fulfilling prophecy,” Fehr said. “The economy is going to slow down.”
    Although not nearly as bad as in some European countries, U.S. government budget deficits remain a concern, he said.
    “Government debts are high. That’s a problem,” he said.
    The federal government’s annual deficit has actually declined in the last couple of years, he pointed out, but, thanks to rising costs of programs such as Medicare and Social Security, will start rising again in the middle of this decade.
    “These are the issues government is going to have to address if we’re going to put ourselves on a sustainable path,” he said.
    The stock market, he noted, is up about 10 percent since the beginning of the year and up 150 percent since the spring of 2009, the lowest part of the recession. That’s in large part because corporate earnings are so strong.
    “So companies have figured out how to do more with less,” Fehr said. “Unfortunately, that means less people.”
    That slow job growth – 9 million jobs were wiped out in the Great Recession – continues to darken the overall picture.
    “We think the economy’s going to continue to grow in the U.S.,” Fehr said, “but it’s below average.”
     
     

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