Brexit – Don’t panic!
From: financial-planning.com
I watched in shock as the Brexit results were reported Thursday night. Then, on Friday morning, I watched as stocks tanked.
Global equities, especially foreign, tumbled. Money poured into safe havens, such as U.S. Treasuries. I knew advisers would be wondering if they should get their clients out of the stock market until the uncertainty vacuum dissipates. I say “don’t even think about it!”
It’s not that I have a clue whether the market reaction is an overreaction, or the beginning of a bear market. Frankly, nobody else does either. The Brexit could have minimal, short-term economic impacts, or could signal the beginning of the end for the EU, leading to long-term impacts such as another great recession or worse. But trying to forecast economic events, and then moving in and out of markets based on those forecasts, has proven to be a fool’s game. The only thing more foolish would be to sell after markets tank, which is an all too human response and tradition.
