If you’ve been following the stock market for the last couple of months you’ve likely been afflicted with repeated vasovagal attacks. This is as close to either medicine or opera as I’m going to get in this piece. When the markets submerge the advice emitted by both casual and professional observers is always the same. As you are in the market for the long run stay calm and invested. This advice caused me to reflect – always dangerous, but I did it anyway. What and when is the long run?
Is the long run a place? Is it the same for a 20 year old as it is for an octogenarian? Has the long run ever arrived before? What does it look like? Will it be the same in California as in the rest of the country? Is it tax deductible? Will Bernie Sanders nationalize it? Can I sell it short? Will the government tax it – a silly question? What do I do if the FISA court blocks my email account? See below.
Do I wake up one morning to find an email from my accountant announcing: “Congratulations! You’ve reached the long run.” Now what? Do I spend all the riches I’ve hoarded so long waiting for this glorious day. Doing so will likely result in my children going to court to have me declared incompetent and asking some friendly west coast judge to appoint them guardians of my portfolio so zealously preserved in anticipation of the long run. Will I have to write a play, as Sophocles did when his heirs tried to have him declared non compos mentis, to prove that what little mentis I have left is above the non compos level? Thus, having discovered the danger in arriving at the long run, I decided to look closely at those who advised planning for its arrival.
First, I must concede that I know nothing about finance or economics which places me firmly in the middle of the pack of those who write on these subjects and above those journalists who occasionally foray into them with gratuitous remarks that we should stay in the market for the long run as the sky is not falling. These latter scribblers wouldn’t know that the sky had fallen if it hit them in their writing hand, today I suppose hands is more appropriate.
There are people who give financial advice for a fee. They either write newsletters or run portfolios. If they’re so good at predicting the financial future why don’t they do it for themselves and not bother making money for other people when they could take their own advice and keep all the profits? The answer is obvious; they get paid for being wrong and their clients suffer the losses. When asked this question financial fortune tellers come up with answers so creative that Papal Infallibility looks mundane by comparison. Look at their homes and cars in comparison to those of their clients.
Then there’s the question of what to do if I missed the long run. Say my accountant’s email went to spam and I continued to wait for the long run. Ten years go by and one of my friends who’s about my age remarks over lunch how much he’s enjoying being at, and now past, the long run. He has no children so he didn’t have to write a play.
I panic at the reality of having missed the longingly sought after long run by a decade. Terms like bubble, correction, crash, the national debt, and default take on new and personally threatening dimensions. Have I done a 180 and arrived back at the short run? Am I really non compos mentis and can I keep it a secret from my progeny. My wife already knows my mental state, but as she controls everything she doesn’t care.
Then I remember the immortal words of John Maynard Keynes, the man responsible for more fiscal chaos than anyone else in human history. “In the long run we’re all dead.” I’ve been looking in the wrong place. I should consult my physician or mortician about the long run. Like the man falling from the top of a 100 story building who remarks at the 50th story, “So far, so good.” I’m still in it for the long run which will arrive after the second (or first depending on your persuasion) coming or when I run out of stories.