Josh Scandlen Podcast

Every year the stock market, as represented by the S&P 500, has significant drops in value.  In fact, the JP Morgan research I cite in this video shows the market drops in value on average 14.2% a year.  Unfortunately, many investment prognosticators fail to take this fact into consideration when they discuss investments... Looking at you Dave Ramsey! They simply cite the average returns over time and thus make assumptions based on those averages.  But you should NOT do that! We are human beings and thus live in the moment.  You can cite all your the averages you want but if I look at my account in the middle of August 2011 and I'm down 19% from its high, the averages become meaningless.  Today is my only concern.  If you've studied or even heard of Benoit Mandelbroit's discussion of fractals, you will see how fractals can be seen in basic investment analysis.  We tend to look at the 'stock market' from the bird's eye view.  The market averages 10.5%  a ye