The End of the World
A perennial event in the world of investing is The End of the World. This is the great event that isn't. It never happens.
Why? Because times are always bad. This is the great lesson of history. Humanity is always up against something that is about to crush it. But it never does.
Take Europe as an example. A few centuries ago, European cities suffered terribly from poor sanitation. Poor sanitation almost wiped out Europe many times over because of diseases like plague. But Europe always survived.
Other crises have since followed. In the 20th Century, it was the great dictators who wanted to rule the world. Hitler failed, the Soviet Union collapsed, and life has gone on.
Now it is the environment. It appears that humanity will be wiped out by nuclear war fallout or other pollutants.
We will survive this one too.
How does this apply to investing? In investing, the world is always about to end. Herein lies an opportunity. If you can be one of the few people to see that both humanity and humanity's desire for products and services is going to go on, you will succeed.
Is humanity ever going to stop needing energy to fuel their cars? Not likely. Is humanity going to stop eating. Highly unlikely. Are people going to stop living in houses? If they did, that would truly be the reversal of a major economic trend.
Keep a steady hand, steady thoughts, and steady emotions. Keep investing in the best companies offering the best of the best in products and services that are not going away.
Here today. Here tomorrow. That's the key.
©Edward Abbott 2003