Do Not Let Dreams Become Expectations

We all dream of getting that new Camaro, retiring on an island, and maybe even seeing the stock market soar. Some dreams, such as low unemployment, hefty consumer spending, and rising home prices, may be slowly changing into expectations. It seems like every month the market is expecting bigger and bigger numbers. I think this was a huge problem today that helped the DJIA sink over 320 points to end the week.

Sure, if you exclude census hiring, the numbers were mostly mixed. Instead of focusing on this month's numbers, why not look at the overall year? Jobs have been added every month this year after rising only 1 month in 2009. Our economy has formed nearly 1 million new jobs in 2010. Another important number is the fact that companies are working their employees longer hours putting many part time workers back on full time status. The economy is starting to walk again, but many people are trying to make it run.

We need to remember that we are not coming out of just any old recession. This was a recession that was on the tail end of a real estate collapse and financial crisis. These are both topics for another post. However, we cannot judge this recession based on previous experiences. Expectations should not be what we want them to be but instead what we think they should be. We have to remember that not all numbers the market does not like are bad. There were many positive things that came out of the report today. They were just hidden behind dreams and did not reflect reality. Do not worry about what the market thinks. Invest how you know things should be. Once the market figures out what is really going on, cash money is right around the corner.