Investing When News Headlines Are Crazy

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The news has the tendency to over-dramatize their stories and especially their titles. Despite what headlines say, this is still a good time to invest. Dana Anspach from Sensible Money talks about things to keep in mind when investing with these crazy news headlines.

Bob: The headlines are crazy and getting crazier. Thoughts?

Dana: Well, I agree. Those are my thoughts. But why?

So I was writing a blog post the other day and in the background, there’s a new tool that will do analytics on your content- basically to show you how well it will “perform” out there in the world. Will people see it? Will they be likely to click on it? One of the tools is a headline analyzer, and underneath it, it says emotionally triggered headlines are likely to drive more clicks.

So if you think about what’s driving the headlines that we see, whether it’s a podcast title or a TV clip or a radio show, they all need people to listen, to view, to click. They’re driven by media dollars and the analytics are out there now to show what it is we click on. Well, we click on things that have an emotional charge to them.

So you see bold predictions because those garner clicks. You see words like plunge and crash and tank. Anytime we’re emotionally triggered, it causes this rush of chemicals in us. Think about that constant bombardment of these different chemicals. You say “I should be doing that!” and “I’m gonna lose everything I have if I don’t do this!” I absolutely think headlines are getting crazier and it does make it more challenging to tune all of that out and try to form a plan.


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Bob: So what advice do you have for folks who are reading about recessions and inflation and interest rates rising who are trying to navigate these markets?

Dana: You know, it’s the ability to step back. They call it zoom out and stick to a set of guiding principles and guiding principles. I guess I would equate it with exercise, right? If you wanna live a healthy lifestyle on a fairly consistent basis, you need to exercise and eat healthy. You don’t have to do it every single day, but you can’t do it all in one day and then be good for the month. It has to be fair.

So when I think of guiding principles, it’s really, “What am I investing for? What’s my timeframe? Why have I chosen these investments?” It’s interesting for me when we hit bear market status just a few weeks ago on the very same day, I can get a call from one client who says, “Hey, you know, I think I’ve got some extra money on the side that I oughta put it in.” They recognize this as a potential opportunity. Then I can get a call from another client that says, “Am I still gonna be okay?” It’s the exact same market event, but two very different sets of emotions that are driving it.

Going back to the guiding principles for the person who says, “I think I have a little bit of money to invest on the side.” Well, what’s your timeframe? What was this money for? How long are you willing to commit it to, to potentially see the results you think you might see? For the person who’s nervous, it’s the same question. It really is the same. What are their guiding principles? When we step away from those, I think that’s when it can get sticky. It can be easy to get sucked into what the latest headlines are because we don’t have a plan or we forgot about our plan, or we’re not clear on the timeline of our plan.

Check out our video with Dana Anspach for more information!