The stock market is freaking killing me!

I’ve been a risky investor for as long as I’ve had money, and it has always seemed to work out for me. That is, until the last few months.

I had some bad performance on a few things over the summer. I understand the market goes up and down, and I typically don’t mind the lows because I know I can just keep buying in cheaper. However, when the stock market assaults my portfolio so viciously like it did this month, it makes me want to give up on investing altogether.

Here’s the damage:

this sucks

I lost over $6,500 in one month!

My 401k took a huge nosedive. My regular investment accounts tanked. My Roth IRA dropped. In fact, my liquid accounts increased by over $1,100 this past month, which means I lost over $7,500 in investment value. I like to consider myself a tough guy, but I think I want to cry a little bit.

Boo hoo.

The Plan of Action

I can’t lose this much money without identifying a root cause and making some changes right? Actually, no. I’m not going to change a thing.

Some of the investment losses were options that have essentially gone to zero. I’ll be looking to unload them whenever there’s even a small market rally to try to get something out of them, but these can’t go any lower; they are pretty much zero right now.

My 401k could probably use some tweaking, which I’m happy to do after some kind of recovery. However, I know for a fact that buying high and selling low is a bad strategy for making money. I’m going to keep buying low while I have the opportunity right now, and when my investments come back up a bit, I will look into diversifying and getting into some less volatile funds.

As far as the rest of my finances are concerned, I’m doing pretty well. I’m not spending too much and all my budget categories are still looking pretty solid. I’m going to keep plugging away at adding money to a savings account, and eventually plan to pay off some student loans with that money.

Economics and Politics are IMPORTANT

You might be wondering why I would pay off student loans when one of my most popular articles is about making minimum student loan payments so you can invest the extra money.

The only problem is I need a strong economy and real market growth for that to work. Right now, I don’t trust the Obama administration to provide an environment where jobs and businesses can thrive. Without a solid economy, the stock market won’t be heading up any time soon.

The failed policies of this current government caused me to lose $6k in my investments. None of the companies or funds I invest in suffered through a scandal this month. Nobody reported bad earnings. The businesses are just doing the best they can in this economy, which is not very well thanks to our government.

Of course I own my investments and could have pulled them out of the market, so the ultimate blame is on my shoulders for not selling earlier and having a risky portfolio. I’m not blaming the government for my investment decisions; only for their failed policies that have unemployment increasing and the economy stagnant.

I’ve been looking for an opportunity to share this music video for weeks, and now seems like as good a time as any. Here is a rather long but highly informative music video about the difference between Keynesian economics (essentially textbook Obamanomics) and Austrian economics (think Reagan as a starting point, but then remove more federal involvement).

Watching this video over the last few weeks has been the best 10 minutes of my August. It’s a sad and lonely existence, but it’s the only one I’ve got.