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Ten-Years Since the Great Recession - Will History Repeat Itself?

Mark J. Smith, CFP®, CPA/PFS, CIMA®
October 10, 2018

On Friday, September 12, 2008, history was made; this was the day that set in motion the Great Recession.  Beginning with the S&P Index declining from its all-time high and followed by an influential investment bank filing for the largest bankruptcy petition we have seen to date, money market funds quickly raising concerns, and bailout funds being used incorrectly to a shocking degree, Americans witnessed a sequence of events that led to what some call one of the worst economic catastrophes in modern history.

But, ten years later, the U.S. is experiencing another record-breaking series of similar historic events.  Household net worth is higher than what it was during its pre-recession peak; the unemployment rate has decreased from 10% to under 4%, with substantial and positive impact on all types of workers; and prices of single-family homes are continuing to significantly increase – leading to the S&P Index increasing to four times its amount in 2009.

So, what does this mean?

To some, this may be a time to enjoy the economy (and rightfully so) and forget the days of chaos and uncertainty; but for others, this is an opportunity to recognize, analyze and understand  past economic events to help prepare you for any “historic” experiences that may arise in the future.

With 77% of U.S. debt owed to the public, global financial uncertainty surrounding us, and the trifecta of the The Great Panic, Depression, and Recession behind us, knowledge is undoubtedly the key to having a secure financial future.  Harry Truman once stated, “The only thing new in the world is the history you do not know.”

Unfortunately, no one can say what will happen tomorrow.  However, you can take steps to prepare for the future – whether this includes investments, retirement, tax planning or even another economic recession.

We have found that those who use a financial advisor have clarity, both about how to live now and how to prepare for later in life, and this makes them feel more financially secure about their decisions.  That is why it is important to connect with a financial advisor that can help you understand past economic trends, as well as provide you with the tools and resources that you need to succeed.

At M.J. Smith and Associates, we are here to help you navigate through all types of financial events so you are prepared for the cycles of the stock market.  Contact us and we would be happy to set up a complimentary portfolio review.

This information does not purport to be a complete description of the developments referred to in this material. Links are being provided for informational purposes only. Raymond James is not affiliated with and does not endorse, authorize or sponsor any of the listed websites or their respective sponsors. Raymond James is not responsible for the content of any website or the collection or use of information regarding any website's users and/or members.

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