09 April 2014
Recent blog from IFS featured on Morningstar Perspectives:
Once upon a time the economy seemed to drive the stock market. Now we tend to think the opposite holds true. Wall Street trading and Main Street business in fact remain disturbingly distinct – which you forget at your peril when investing.
The following headline caught my attention recently: “American Stock Markets Are Surging, So Why Do Americans Feel Like It’s Still Recession?” I hoped to read about the need for investors to understand the difference between stock markets and the economy, to read that traders react to headlines and long-term investors stay the course.
Instead, the article touches on investors’ confidence, suggesting that good feelings plummeted as a result of the Great Depression and then that falling investor confidence caused our Great Recession in 2008-2009.