For anyone with money to manage, now may be the time for a touch of unquestioning optimism.
The suggestion may seem grotesque, considering the grim events this week. The toll of innocent lives lost in the terrorist attacks is still being tallied, and the reckoning of the damage to businesses and the economy has just begun.
Financial calculation is the last thing on most minds today.
Before long, though, a calamity of this magnitude commands the attention of every saver and investor, big or small.
In the securities trading that has occurred around the world while US stock markets remained closed, a predictable move has been seen away from riskier assets and toward perceived safe havens such as US Treasury notes. We always hear about a "flight to quality" when investor confidence is shaken.
The impulse is understandable. In the harsh way these things work, the whole horrific story makes everyone reconsider the risks, financial and otherwise, they are exposed to in life.
Even so, this method of making decisions will never serve as a good investment system -- to flee for safe havens when fearful events occur, and then to venture out again into riskier securities only when it appears the coast is clear.
Doing that puts me, in financial lingo, on the wrong side of every trade, buying from and selling to people who are thinking more calmly and farther into the future than I.
Right now it's unclear how events might proceed, step by step, from here to reward investors who remain optimistic. How will this ever benefit, say, emerging-market bond funds, or anything else that comes with a high-risk label? When you think about it, optimism requires a leap of faith.
In the popular image, the "smart money" is bearish, with an inside view of the flaws and perils in everything.
The hedge-fund honchos, the gnomes of Zurich and the short-sellers of Wall Street -- these are the people who know what's what, and you'd never catch them in the role of the cockeyed optimist. That leaves optimism as the province of the simpleton, the small-timer who looks in the mirror every morning and prattles, "I'm bullish! I'm bullish!" The trouble with those stereotypes is, they can't stand up to a simple stock chart.
Look back over the last 30 years when the Standard & Poor's 500 Index and the Dow Jones Industrial Average each returned more than 3,800 percent, or 13 percent a year, doubling what you could get in "safer" places. The optimists won in a walk.
Yes, it's true that those three decades encompass one of the great bull markets of history. But 1970-2000 also included three bad recessions, outbreaks of war and terrorism, and a global energy emergency or two. Not to mention the resignation of one US president, the impeachment of a second and the attempted assassination of a third.
If all that could be overcome, what can't? As somebody outside the US, Bank of England Governor Sir Edward George, reminded us in a speech yesterday: "It would be a mistake to underestimate the resilience of the American people."
For balance's sake, we don't want to underestimate how long it might take for the markets and the economy to recover from this invasive blow. After the first rally, let's see.
We're a long way already from the "irrational exuberance" that Federal Reserve Chairman Alan Greenspan warned us about five years ago.
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