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BREAKING NEWS! Stock Market Plunges 1,100 Points This Morning . . .

The stock market opened this morning with the Dow dropping as many as 1,100 points. To put this into perspective, the Dow has never closed down more than 800 points in a day!

 

I briefly turned on a financial TV channel to see what the financial gurus were saying. They were obviously struggling to explain this huge loss. Unlike their usual self-assuredness, they were unable to clearly articulate why it was happening and what was going to happen.

 

As we’ve been sharing with our MoneyWise listeners for the past couples of years, when any market has six straight years of amazing growth in value and is at or near record highs – we need to be cautious! So, we’ve been recommending no more than 25% of an individual’s investments in the stock market. And we’ve encouraged investors to do their homework and invest in solid companies that have little or no debt and pay a dividend.

 

The two passages that give us the clearest guidance when it comes to investing are Proverbs 21:5, “Steady plodding brings prosperity; hasty speculation brings poverty.” In other words, be a consistent investor even if you can afford just a few dollars a month.

 

The other passage is Ecclesiastes 11:2, “Divide your portion to seven or even eight, for you do not know what misfortune may occur upon the earth.” In other words, it’s wise to diversify and not to put all of our investment dollars into one basket.

 

One final thought. When we face major financial challenges that are global and beyond our control, remember what 1 Timothy 6:17 tell us: “. . . don’t fix your hope on the uncertainty of riches, but on God who richly supplies us with all things to enjoy.” All riches are uncertain. Stocks, real estate, bonds, and gold go up and down in value. There is only one thing on the planet that is certain and that is the Lord Himself. He told us in Hebrews 13:5, “I will never desert you, nor will I ever forsake you.”

Stock Market: recession

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Hurricane Sandy

What do the hurricane “Sandy” and Steve Jobs’ new yacht have in common?

Sandy was the largest storm (1000 miles in circumference) on record to smash into the US east coast. Dozens lost their lives, some 8 million people lost power, and the damage to property is estimated to be north of $50 billion. I talked with a close friend this morning from Connecticut, and he told of the devastation. He ended by saying, “Our family is safe and that’s all that matters. Our things might be gone, but we’re safe.”

About the same time as Sandy was coming on shore and a year after his death, Steve Jobs’ 256 foot super yacht was launched. Think of the gazillions of dollars and all Jobs’ time and effort invested in this yacht that he will never sail.

People invest so much money and time in accumulating things that are so fragile and uncertain. I Timothy 6:17 cautions us, “Do not fix your hope on the uncertainty of riches, but only on God.”

We are called by the Lord to be faithful stewards of all that He entrusts to us. We are to work hard, to give generously, to get out of debt and to save and invest. BUT, we must Continue reading Hurricane Sandy