Fisher Investments’ Ken Fisher Debunks ”Don’t Fight the Fed”
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- Опубліковано 20 кві 2023
- Fisher Investments’ founder, Executive Chairman and Co-Chief Investment Officer Ken Fisher debunks the common myth that investors should not ‘Fight the Fed’. The theory suggests investors should avoid investing in stocks when the Federal Reserve (“Fed”) hikes short-term interest rates and invest when the Fed is loosening rates. However, as Ken wrote in his book Debunkery, Fed rate adjustments tend to have little long-term effect on capital markets.
While rate hikes may cause short-term downward volatility, Ken says the long term impacts on stock prices are largely unaffected by Fed decisions about rates. Ken explains how interest rate adjustments don’t tighten or loosen the amount of money available for lending, they change the price of that money. With history showing rising and falling stock prices regardless of the interest rate environment, Ken recommends putting little weight behind any Fed decisions and to stay disciplined to a long-term investment strategy.
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Investing in securities involves a risk of loss. Past performance is never a guarantee of future returns. Investing in foreign stock markets involves additional risks, such as the risk of currency fluctuations. The foregoing constitutes the general views of Fisher Investments and should not be regarded as personalized investment advice. Nothing herein is intended to be a recommendation. The opinions expressed are subject to change without notice.
Thank you for the video and debunking. This is not taught at my business school.
Thank you Mr. Fisher
enjoying the book now...
From Part 3 of "Everyone Knows" in Debunkery Bunk #28, Ken is always astute and cogent in his comments.
Debunkery helps keep my head straight.
Interesting
It seems scarier without the fireplace in the background.
Did a quick calc on barchart. SP500 up 16.6% since Oct 12 2022. Not bad. Now you spoke ab rate hikes vs rtns but how about higher int rates vs lower int rates, say 3 to 5% diff over much longer periods? Was always taught higher int rates are gravity on stock rtns. That may be one for mailbag? If not, that is fine.
History repeats itself.
So if the rate hikes dont really help tighten money supply and it doesnt help much w inflation, why does the Fed do it? What would be the benefit or positives?
Also, how much impact does corporate concentration and lack of true competition have on inflation? I learned ab the law of supply and demand in my econ class decades ago, but that was based on...competition. What do we do ab corps using inflation as a cover as they rake in record profits.
Reality check.
Thanks
Interesting, so would you agree with Warren Buffet that the S&P500 is a safe investment?
Buffett has very little in the S&P500 but 120 billion sitting in cash.