“Come gather 'round, people wherever you roam and admit that the waters around you have grown
And accept it that soon you'll be drenched to the bone if your time to you is worth savin'
And you better start swimmin' or you'll sink like a stone for the times they are a-changin'”
This is the first part of the lyrics to the famous Bob Dylan song, practically an anthem for the Baby Boomer generation. I bring this up as the events of today are not unlike what happened during the late 60’s early 70’s. I was living in San Francisco during this period. I got to witness firsthand the civil unrest that was brought about from an unpopular war in South East Asia and the expansion of Civil Rights. The economic uncertainty and recession that followed forever changed the economy in the San Francisco Bay area.
President Nixon had some incredibly challenging economic headwinds, from inflation to de-linking the gold standard from our currency. Young people were protesting the war and the expansion of civil rights. He won in a landslide re-election. But what happened afterwards was the contraction of federal spending, specifically in defense ,and we went from stagflation to inflation. From there we had one of the longest running recessions and economic declines since the Great Depression.
President Trump is facing a lot of criticism of his handling of the COVID-19 in much the same way that President Nixon did with his handling of the Vietnam War. Today there are protests calling for social justice. The economic headwinds we are facing are just as serious. Whatever the outcome of the election in November, change will be coming in terms of federal spending on defense. I recently read a great article from Defense One in which experts from the Army and Boeing predicted a contraction in defense spending. You can read the full article here: https://www.defenseone.com/business/2020/05/global-business-brief-may-28-2020/165722/ Huntsville depends a lot on defense spending.
I cannot and will not make future predictions. What I can do and how we can help you is to help plan for the what-ifs. Having a plan for an unexpected retirement and an investment strategy that is stress tested for a market retraction is the surest way to prepare you and your family for whatever happens in November and beyond. For those of you who adamantly proclaimed to me that you will never retire, I hope it works out for you. For the rest, give us a call and we will help you prepare for whatever comes next.
Mike Mickels is President of CochranMickels Retirement Specialists and an avid sporting clay competitor. CochranMickels Retirement Specialists provides personalized planning and investment services to individuals approaching and in retirement. They also provide retirement and benefits training to Federal employees. Securities offered through Registered Representatives of Cambridge Investment Research, Inc., a broker-dealer, member FINRA/SIPC. Advisory services offered through Cambridge Investment Research Advisors, Inc, a Registered Investment Advisor. CochranMickels and Cambridge are not affiliated.