Working With Turbulence in the Markets #198

In this episode, Josh Nelson and Jeremy Busch discuss the challenges investors may face when making financial decisions during periods of market uncertainty. They explore common questions such as current market conditions, potential future trends, and general considerations investors may evaluate within their portfolios to help manage risk and uncertainty.

This podcast is intended for informational and educational purposes only and should not be construed as personalized investment advice or a recommendation to take any specific action. Listening to this podcast does not create an advisory relationship. Please consult a qualified financial professional regarding your individual situation before making any financial decisions. If you find this discussion helpful, you may consider sharing it with others who might benefit.

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Podcast Editor: Tim Leaman/info.primegen@gmail.com

Transcript

Wiser Financial Advisor – Working with Turbulence in the Markets

Hi Everyone, and welcome to the Wiser Financial Advisor podcast, where we get real, we get honest, and we get clear about the financial world and your money. This is Josh Nelson, a Certified Financial Planner, founder and CEO of Keystone Financial Services. Let the financial fun begin!

Josh: I’m here with Certified Financial Planner Jeremy Bush. Welcome to everybody tuning in on Facebook Live and tuning into the webinar on Zoom. And welcome to all of you who are listening to this after the fact, either on the podcast or on our YouTube channel. We try to get this out in lots of different formats. We know that people consume stuff like this in different places. So if you're here, that's good.

Jeremy: In general, we're always keeping an eye on things and there always seem to be some markers out there saying, “Hey, this is when volatility reaches its power point.”

Josh: Yeah, it's the official Wall Street index for volatility. I think most people have flown on an airplane before. In fact, I was talking to a client the other day who just got back from an epic retirement celebration trip, and literally flew all the way around the world. It was 10 different flights. I asked him, “Of those 10 flights, how many had zero turbulence?” And he said, “None.” You're going to always experience that turbulence as an investor too, right? So Jeremy, what are some of the questions you've been hearing from people over the last five weeks or so? That's when this stuff with Iran happened and a lot of volatility ticked up.

Jeremy: Well, it's hard for people not to get emotional about their money, which is a big reason for why we have jobs—so we can be that voice of reason on this stuff. The questions I’m hearing are things like, “Where do you see this headed? What's your crystal ball say? What things can we do within the portfolio to mitigate a lot of this? What should we do?” I tell people that we're constantly behind the scenes doing rebalances and taking in a lot of research. No matter if it's a good market or a bad market or whatever's happening in the world, there are always certain sectors that do better during certain times. A lot of people don't understand that much of what we're doing behind the scenes is making small adjustments to everybody's portfolios during this time as we think, “Hey, this sector is probably going to do better than maybe this one.” We’re doing these little moves here and there, and over time, that makes a big difference.

Josh: It does. In fact, I've seen a number of studies over the years that have talked about rebalancing a portfolio. Let's say you had a portfolio made up of 80% US stocks and 20% foreign stocks. And all of a sudden, things get crazy like they have this year, and foreign stocks start doing poorly and drop a bunch. So now, instead of having 80-20, you're like 85-15. It could be that extreme. A disciplined rebalance, as much as it might not feel good at the time, means you're going back to your target of 80-20, which means you'd be selling some U.S. stocks and buying foreign stocks, if that was your target to rebalance. That’s a simple example, but we've seen a number of studies that show disciplined rebalancing results in a higher rate of return for investors over time versus never rebalancing.

Jeremy: Yeah, the whole ‘set it and forget it’ is not so much our thing. But before we get into the slides, I want to remind anybody who's live right now, to feel free to use the Q&A feature on the Zoom screen. There are only a handful of slides here, so that part will be quick, but we'd love to take your questions. So please shoot those over as you think of them.

Josh: And the lawyers, the compliance people tell us to say at the beginning that this is just our opinions, because we don't know. I think everybody gets it that when there's geopolitical stuff like this going on, nobody can predict what's going to happen. We'll go through a number of different crises that have happened in the past. Nobody knows when it's going to end or when things are going to get better. So, I'll probably overuse the analogy of being on an airline flight when things get turbulent. That's normal, but sometimes things get so turbulent that it's really uncomfortable and you're getting the puke bags out. In some cases, like last April, we were doing one of these talks about a year ago when tariff announcements came out and so-called Liberation Day brought on a lot of volatility in the market. The market was down almost 20% in a short amount of time. 

We saw even more of an extreme during the pandemic in 2020 when the economy shut down. I think in a span of three weeks, the market was down 30 something percent. That would be the equivalent of the puke bags coming out, just a huge amount of uncertainty. It's natural to be uncomfortable with major turbulence, even for seasoned investors, even someone who's been on hundreds or thousands of flights. Nobody would choose turbulence if they had the choice of a smooth flight. But that is exactly the trade-off if you choose not to fly. That would be the equivalent of saying, “I'm not going to be in the market, not going to be with any investment that has uncertainty. I'm just going to park my money in the bank, put it in a money market, something like that. The trade-off, of course, is you're not going to Hawaii or New Zealand. Those destinations are not going to be a choice for you. And for some people, that's okay. If somebody had a monster amount of money, they may not run out. That’s the name of the game over the long run: Don't run out of money when it comes to retirement and financial freedom. Get to the point where you've got enough money that it’s got a high likelihood of gaining critical mass. And then, don't mess it up. How you can mess it up is by getting too low of a rate of return. We run retirement projections for people all the time. If you're in investments, they have no inflation protection. If you were in 100% bond portfolio or cash portfolio, that might feel more comfortable in the short run. But long term, those are investments that will not be able to outpace inflation. So, if you ever wonder during times of volatility, why do I own stocks or real estate? Why own these things that give me heartache and make me sick sometimes? It’s because those are the only asset classes that have a chance to beat inflation. We can't say guarantee, of course, but they have a chance of outpacing inflation over time.

Jeremy: Josh, tell us what this slide is saying.

Josh: Back in the 1940s, Pearl Harbor was attacked. Two years ago, my family went to Oahu and got to visit Pearl Harbor. It was powerful to be there and think about when that happened. None of us were around then. You’d have to be very old to remember that. But certainly, it was a major world event. There have been other extreme events that were that disruptive, like 9-11 or the 2020 pandemic. So what we have listed on this slide is from 1941 to 2026, a sampling of some of the things that were extremely disruptive to the world economy. The interesting thing is that for either a long-term investor or a short-term investor, if you're trying to trade and get in and out of the market at the right time, good luck with that. Nobody that I know of has ever done it. Warren Buffett has said that he's never met somebody who can consistently time the market. How do you predict a pandemic? How do you predict a 9-11 unless you're involved in it? It isn’t possible. But the interesting thing about these shock events, as much as they may cause a huge drop in the market in the short run, you can see that after a month, six months, one year, in more than 60% of the time on average, the market goes higher than it was when the event occurred. So obviously, that means that the other, 30 or 40% of the time, things got worse. For example, after 9-11, the market was lower a year from that point. But surprisingly, it wasn't because of 9-11; it was because something else bad happened.

Jeremy: You get those compounding events that work together and domino.

Josh: Several bad events cascaded. In 2000, we saw the tech bubble burst and then 9-11 happened in 2001. Then in 2002, nothing to do with 9-11 or the bubble, the financial system took a hit due to accounting scandals. Big accounting firms were involved in cooking the books at some big companies like Enron, which no longer exists now, and WorldCom, another company that doesn't exist anymore. They were cooking the books in the background, which is highly illegal and unethical. It wasn't just a couple of companies and it called into question the entire market as people wondered how widespread it was. You know, asking if Coca-Cola and Berkshire Hathaway, could all these companies be cooking the books? We were working off false information for earnings. So, to unpack that a little, just because you have a bad month or six months or a year, doesn't mean things can't get worse. Sometimes they get much worse before they get better.

Jeremy: And to put it into perspective, last week there were announcements that the Dow and the NASDAQ officially hit correction territory, right? 10% down. But on our forecast in January, we talked about how often it happens, about once a year that the market hits 10% correction territory. We had a correction last year at about the same time, when the tariff announcements came out. But then the numbers panned out. So the idea we’re trying to convey here is that, at the time when you're feeling these events, they feel really big. Most people deal with being in the here and now and seeing what's happening, and there’s a tendency to give that a lot of weight. But remember that if you have a financial planner and a long-term financial plan, your diversified portfolio is already set up to weather these storms. That's a lot of what I've been having conversations with clients about. Your diversified portfolio is built for this stuff. It doesn't feel good during the time that it's happening, but it's meant to work over the long run.

Josh: Yeah, as long as somebody's diversified. Now, if you have all your money in one stock, think of an Enron, which was terrible back at the time, because a lot of Enron employees not only owned a lot of Enron stock personally, but also it used to be allowed for 401K participants to put all their money in their own company stock in the 401K plan. Horrible! You can't even do that anymore but back then, you could. So not only did their stock go to zero, but also their 401K went to zero, plus they were out of a job and lost their health insurance. That’s an example of putting all your eggs in one basket by putting it all in one stock or even one asset class, like all tech stocks or all energy stocks. That's not wise. Staying diversified is key so you can come back to fight another day. 

Not that there's a guarantee, but there's never been a time when there was a correction or a bear market or a recession that wasn’t followed by a time when things came back and eventually went higher than they were before. It’s a good reminder to all of us when we're going through a period of volatility. On an airplane, things get turbulent when you land in Denver almost every time. You can predict it. The landings in Denver are terrible. The air's choppy, which doesn't feel good no matter how many flights you've been on. But if you start getting panicky, it's good to remember that planes don't crash because of turbulence. We have a couple of clients that are airline pilots, and it’s interesting talking to them. Up in the cockpit, when things get turbulent, do those guys get nervous? They don't, that's their job, right? They do it all the time. We're the equivalent of your pilots in the cockpit, flying financial planes. We've got a plan. We've spent time. We’ve talked about risk with every client, and everyone's different, right? Everybody has a different risk number. But if you have a well thought out plan, you're diversified. And when things are crazy, that's not a time to throw the plan out the window. That would be the equivalent of saying let's put it all in cash, let's put it all in gold, let's put it all in the backyard in a hole.             

During times like this when the market's volatile, friends or family probably say this to you, “I bet things have been crazy at work. I bet clients are freaking out.” But we're not experiencing that now. We didn't last year either, even when the market was way down.

Jeremy: I give a lot of credit to our clients on that. Most of them have been around or been in the market long enough that they've seen these ups and downs. They've seen what it does over the long term. That makes our lives easier, but it doesn't mean we're not having those semi-emotional conversations with people in meetings, which is perfectly fine.

Josh: Yeah, and I think the other key there is remembering how much time they have before they were planning to touch this money anyway. Now, if you needed your entire portfolio by next month because you were going to cash it all out and go buy a house or something, I'd be nervous. That's not good. You shouldn't be invested in the market if your time frame is that short term. But for most clients, their time horizon is years, if not decades, before they're planning on taking that money out, and then just in little pieces. 

For those of you who are still working, volatility is great because as you're dollar cost averaging and putting money into your 401K or your company's stock, dollar cost averaging means you're getting an average price on whatever it is that you're putting your money into. As odd as it sounds, market drops are good for the new money that you're putting in. For our clients that are retired and drawing money out, it doesn't feel as good. When volatility happens and things are down and we’re taking money out, we're only taking little pieces. There's a monthly amount that might be deposited in your checking account, but not the entire portfolio. So, it's important to recognize, what's my true time frame?

Jeremy: Yep. The other slide we have here gives us a visual of what the market's doing  before, during, and after the volatility. This is a simplified slide of something that we've used in the past, the Morningstar and X chart. Some major things happened that felt super important at the time. But over the long timeframe, they're all just bumps in the road.

Josh: Yeah, even something extreme like the COVID pandemic shows up there. For those of you who are just listening and not watching, there’s a jaggedness to the market over decades. During COVID there was a pretty big drop, right? There were lasting effects on the economy, on how we live, things like DoorDash and other ways we go about our lives. I think the moral of the story is that, yes, there are extreme things that happen, but eventually we figure it out. As a people we figure it out and adjust and move on. That's not to minimize any of the heartache from these things, whether it be war or pandemic or 9-11. Extreme emotional events affect people's lives. But the moral is that bad stuff happened but time passed. People figured it out. We moved on. And from the market standpoint, if you think about individual companies such as Apple or Walmart or Costco, they are still producing the service of products. They're still profitable. They're not disappearing. In some cases, they're able to take advantage of it. Think of energy companies right now. Those have been some of the best performers over the last month. because oil prices have spiked, and their profits are expected to go way up, especially if oil prices remain elevated for a while. So, should you put all your money in any one sector or company? No. But just because something bad happens doesn't mean that companies in some cases can’t benefit from it, or at the very least, they're adaptable.

Jeremy: I've had this conversation with clients a lot too, about how no matter what’s happening politically or economically in the world, companies are good at pivoting. All they’ve got to know is a direction to point in. About a year ago when tariffs were announced, companies were trying to digest what all these tariffs meant. Then they’d say, “Okay, we know what this means now. We can point in this direction.” And they're very good at adapting, it just takes some time. But it's that short-term volatility that everybody freaks out about, which causes some undue emotional states.

Josh: Yeah, like choppy air. You could be the best pilot in the best aircraft ever, but you’ll still encounter turbulence. You adjust accordingly. Pilots adjust their approach to the runway as they're landing. They'll do what they can. Pilots don't really care about turbulence, right? Do they care about the passengers in the back? Yes, part of their job is to try to make people as comfortable as possible. Ultimately, it's about safety. It's about getting to their destination safely. They can't guarantee anything, no matter how good their training is. They're operating in an environment of uncertainty. The same holds true for us as financial advisors and investors. That’s life. We will all be navigating good stuff and bad stuff, but there's still a right and a wrong way to react. And as you said, adaptability is huge.

Jeremy: Everything we're talking about is, of course, our opinions about this stuff. Josh, what do you see are the common mistakes in times like this that investors make?

Josh: Probably the biggest mistake I see people make is that when things get crazy, they glue themselves to the news. You have to remember that the people in the media are in the business of eyeballs and clicks to keep you watching, which means that everything they're putting out there for all of us is to disturb us. It doesn't matter if it’s liberal, conservative, or middle road, it's all built to do the same thing, because they're in the business of advertising. The longer they can keep you there, the more money they're going to make. So, if you're watching the market all day long, whether the market's good or bad, if you're watching as an investor, you have to ask whether that’s doing you any good, or just raising your anxiety level. For most people, it's going to raise your anxiety level. Not to say that you should be ignorant of what's going on in the world, but there's a difference between having some idea of what's happening and being glued to the TV or the Internet all day long. That’s designed to make you anxious. It's a human thing. That's probably the biggest mistake. 

The second mistake is acting on it, because they want to make you scared. There's a difference between being scared and doing something extreme. Back to my airplane example, taking off your seatbelt and trying to open the door mid-flight would be insane. And sometimes investors do the equivalent of that financially when their emotions get worked up too high. We don't see it happen often, but sometimes people will take a well-diversified portfolio and get so fearful that the world's going to end and their money will go to zero that they say, “All right, I want to cash out and go to a money market or CDs,” or something like that. And it's your money, right? We all get to make those decisions for ourselves. But that is not often going to be a good decision over the long run, because even if you knew when to get out, how will you know when to get back in? Even if you could predict the pandemic, if you had gotten out, when would you have gotten back in? Things were much higher a year later. Would you have known when to get back in?

Jeremy: We've seen that in practice when someone does freak out. Luckily, it doesn't happen a lot, but when someone does get out, the hardest part is timing when to buy back in. Because there's always some concern in the market or this leading to that which is leading to something else, that makes buying back in the hardest part. We've covered that stat previously in other webinars and podcasts. On some of those biggest days in the market when you're getting some of the biggest gains, it’s typical that right afterward, bad things happen. You're not going to participate in the gains if you're not in the market, because chances are you're not going to be bought back in at that time.

Josh: One of the cardinal rules of investing is to buy low and sell high, right? But your emotions are not going to tell you to do that at the time. For example, buying in right after 9-11 or right as the pandemic’s hitting is not going to feel good. It's easy to extrapolate in your mind that the market's down 10, 20%, so it will go down 80% before things bottom out. And as a reminder, it's not like we know exactly the timing of any of these things. We can’t know.

Jeremy: Another mistake is people not understanding the risk in their portfolio. Sometimes people are just way too aggressive for what their comfort level actually is, but they don't know it. We see this happen sometimes, especially over the last few years when tech stocks and a lot of AI related stocks have been a rocket ship. Sometimes people get overexposed to individual companies or even just a sector, not realizing that we are going down the highway at 99 miles an hour and the risk involved with that. The losses on the other end of that could be catastrophic, could even be permanent in some cases.

Josh: Yeah, it's easy to be high risk in good times. That's why during corrections is probably the best time to be having that risk conversation with clients. That’s a time to assess how do you feel right now? Because that's probably your risk tolerance in all reality.

Jeremy: Yeah, every client has a risk number. We spend a lot of time talking with people about their risk number, and it can range from 1 to 100, right? Most people are somewhere in the middle of a balanced mix and being diversified. We like to spend that time up front to know what a typical bad day or bad month or bad year looks like in a 60 mile an hour portfolio or in a 30 mile an hour portfolio.

Josh: Absolutely. So, we have a couple of good questions here. Which asset classes historically perform best during periods of geopolitical instability? Do you think that pattern still holds true in today's market environment?

Jeremy: The easy answer is: We don't know. There isn’t anything completely consistent. Take gold, for example. Sometimes people have it in mind that gold tends to perform the best during times when there's a huge amount of uncertainty. Sometimes that's true.

Josh: That's a good point. There isn’t a 100% correlation on any specific asset class, but I would say there are some asset classes that tend to do better during war times or things like that but there isn’t a 100% correlation.

Jeremy: It depends on what the crisis is. Right now, it's energy stocks, defense stocks doing well. The stocks that have been hit the hardest are software stocks, specifically in the tech sector, not necessarily related to Iran, but more fear of disruption from AI. Cash was the most boring asset class, right? That's just money deposited in CDs, money markets. You go back and look at extreme times like 2022 when you saw stocks and bonds go down. Then during the financial crisis about the only thing that held its value was cash equivalents or short-term treasuries. Stocks of every flavor dropped, real estate values dropped. Real estate wasn’t a safe haven, even if you owned individual rental properties. Sometimes people think having a bunch of rental properties is the answer, but in the financial crisis you had mass vacancies. You could be sitting on properties dropping in value with no renter or your renter trashed the place right before they opened a meth lab in the basement. There is no risk-free investment for sure, which is why we push for diversification and having all the sectors covered. What’s actually going to happen is unpredictable.

There are a couple other questions here that are similar, so I'm going to tackle those. How are we adjusting portfolio allocations? What kind of rebalancing have we done? Well, we get a lot of research from big places where people spend billions a year on market research. And it can shift pretty quick, right, as to which things are doing better and which things not so much. Behind the scenes, at least here at Keystone, we're constantly taking this into account. We have software that helps us sort out recommendations from various money managers who share what they’re thinking. We have an investment committee that meets regularly to discuss all this as well. Often, what we're doing behind the scenes is taking in this real-time research that's happening all the time, and then making those small tweaks to people's portfolios in a way that’s highly dependent on their risk score.

Josh: Yeah, absolutely. We pay attention to the largest institutions in the world, Schwab, Fidelity, BlackRock, Morningstar, and others. We use their expertise. And as far as adjustments we make, it’s adjusting like a cruise ship versus a speedboat. At Keystone, you're never going to see the extremes where all of a sudden we've gone 100% to gold or cash or something like that. These are going to be micro adjustments in a portfolio. We measure the experts. Say if we're getting research from BlackRock or Morningstar, our investment committee is looking at how they are doing and what's their track record. How are they doing against the rest of the market with their recommendations? So, because we're independent, we're not married to any of them. It’s our job to be a good steward of assets. That's what a fiduciary is, looking out for your clients' best interests. That's something we take very seriously.

Jeremy: Here’s another question: JP Morgan News Today is talking about an economic time bomb, mostly surrounding global oil reserves and the uncertainty around that. So, I know Josh has said this many times: Guard yourself, no matter where you get your news. There are a lot of articles out there, and the thing about modern technology is that you have it on your TV, on your phone, on your computer.  Depending on where you're getting your news, just know that every news outlet is also trying to sell you and get you to pay attention to what they're saying. “What we're saying is important and forget about the other guy.”

Josh: Yeah. And even the experts can be wrong. Often, they are. And sometimes they're right. Using JP Morgan as an example, not to knock them at all, Chase has been for quite some time the biggest bank in the world, so you would certainly want to listen to what they say. But Jamie Dimon, their CEO, I think it was back in 2023, was predicting recession and a catastrophic drop in the world economy. If you had acted on that and gone to cash and sat on the sidelines, you would have missed out. In 2023, 2024, 2025 we had one of the best stock market runs of all time. This is the guy running the biggest bank in the world, supposedly one of the greatest financial experts, but he was dead wrong. He might be right this time. JP Morgan might be right, but it's always good to think about how the experts, even the president and the Federal Reserve, the people with all the information supposedly, like in the financial crisis, let that happen.

Jeremy: Yeah. And yes, there may be something to these things being said. Is there concern about oil? Yes, largely because of what is going on with Iran. That's impacting supply lines big time. That's some genuine concern to have. But again, the best thing you can do is stay diversified. We don't want 100% of everything to be in oil, right? That'd be terrible. Your best bet at any given time is still to stay diversified. Yes, there is a little exposure in your portfolios to oil. There's energy in there. But often, what we do with clients is say, “Hey, if you are genuinely concerned, instead of selling out or being really drastic, let's talk about how much cash you're going to need for the next six or 12 months.” Then what we're going to do is take that cash and set it aside. Then you can let your portfolio ride the wave for the next 6, 12 months, and you don't have to worry about it because you know the next 6 to 12 months are covered. That approach is not necessarily something we always suggest, but it is better than getting out of the market entirely. 

Josh: Exactly. A lot of it comes down to time frames. So, even if JP Morgan is right and there's some huge disruption that happens this month, if we're talking about planning for decades, this might be one of those extreme blips like on our historical chart. It still comes down to asking if you would be able to time it correctly. Even if they're right, how would you know when to get back in? It’s not likely that you're going to be able to do that. It comes back to short term thinking versus long term thinking. As Certified Financial Planners, we're thinking long term as well as how to cover today's needs from a cash flow perspective, which involves planning for a portfolio over the long run.

Jeremy: Yep. and then our last two questions are around AI. How do you differentiate between AI companies with sustainable competitive advantages versus those benefiting from short-term hype cycles? That's a great question.

Josh: Yeah. I think it was Warren Buffett originally who coined the term “economic moat.”  Companies with a wide moat tend to be like a castle. You might have a moat around the castle, and if your moat is wide, that's a good thing if you're trying to defend against invaders, versus a company that has a narrow moat or no moat, that are at much greater risk. That's an area where we do lean pretty heavily on our experts at Schwab and Fidelity and BlackRock to be helping guide which companies people should have exposure to. The best answer I can give is that adaptability is going to be huge when you see changes happening as quickly as we are right now in AI. Looking to companies, do they have a wide economic moat around themselves? Do they have a competitive advantage? Are they profitable? In a lot of cases, these companies are extremely profitable. That's a big difference when comparing against the dot-coms of the late 90s, which a lot of people are comparing to AI companies. Most of the dot-coms never made any money, never generated a profit, yet their stocks were going through the roof. Is there some of that now with AI? With some of the smaller or newer AI companies, absolutely. But some companies are making huge profits right now.

Jeremy: With our exchange traded fund models, I've noticed over the past year and a half and maybe a little longer than that, the addition of AI infrastructure ETFs, an AI Index as it were. That’s a diversified way of doing it, but you're participating in it. You're buying the exposure.

Josh: Exactly. I think that's important because for example NVidia might the highest flying company for a while, but every company has its day in the sun in any sector. Jeff Bezos actually told his employees not long ago at Amazon, that as successful as we are, Amazon someday will not be here, or at least won’t be on top. Hard to even think of that, because of how much Amazon is embedded in our daily lives. But he's right, given enough time, how many companies can you point to that existed 100 or 150 years ago? Not many. There are some, but they're probably a shadow of what they once were.

Jeremy: All right. Our last question is a good one too. Is Keystone leveraging AI to help manage or direct portfolios?

Josh: Yeah, in the research, there's no question. Research analysts at the big companies like Fidelity and Morningstar and so forth are using it to crunch numbers, absolutely. Things that used to take a lot more people hours of calculations can be done now in minutes. A research analyst is still an occupation. It hasn't gone away completely, so the robots aren't controlling everything. There's still human judgment involved. But are they leveraging AI to crunch numbers, pull summaries of research reports, earnings reports, and things like that? Absolutely. There's always going to be some technology advantage there, but at the end of the day, you do want the pilot up in the cockpit making that judgment.

Jeremy: Yeah. So, are we leveraging AI at Keystone? Yes. Are we leveraging AI to manage or direct portfolios right now? No. That's still very much hands on for us. Like Josh was saying, we use AI in the research department, pointing us in specific directions, digesting a lot of data. It's very helpful for that, because there's a lot of real-time market data happening all the time around us. It’s a powerful tool for that, but not in directly managing portfolios. We are very much involved with that.

Josh: Yeah, as a company we're getting more efficient, as most companies are right now. If you're not, you're going to be in trouble. You're not going to be able to keep up. We use it to manage workflows and operate as a company, but this is very much still a human business. If we fast forward 20, 30 years, maybe more will be automated in the world. But for the clients who work with us and trust us, the primary thing you’re getting is somebody who cares and actually knows you, and we’ve got a vested interest in helping you succeed. We appreciate the relationships we've got with all our clients. That's the best part, really. We get to have a big impact in a very human way, connecting with people.

Jeremy: Absolutely. That’s all the questions we have. Any parting thoughts? We are coming up on our time.

Josh: Quick quotes, Warren Buffett, who’s still out there, by the way. He's stepped down from his CEO role, but he's still chairman, so still working at 95. Maybe I'll be here at 95. We'll see. But one of his famous quotes is, “Be greedy when others are fearful and be fearful when others are greedy.” That shouldn't be taken as a market timing comment, but I think it is instructive. He’s saying that when prices are low, that means everybody is scared. And when you look at that chart we were showing before, those dips would have been the best times to invest, when everybody else was fearful and stocks were really cheap. So, when everybody else is greedy because something has just gone through the roof, maybe it's AI, maybe it's gold, maybe it's dot-com stocks and the real estate bubble we had in the 2000s, then you want to be careful. That’s not to say you shouldn't have exposure to some of these areas, but when there's a mania happening for something, it should be a warning sign to not get overexposed to that one thing. We are very cognizant of that as we're managing portfolios. 

The second quote is from Bill Ackman, who manages a lot of money. He's out there in the media quite a bit, but he says, “High quality businesses are trading at extremely cheap prices.”  We've seen a good market jump here the last couple of days, so there's always an opportunity. And when there's been a sector or a company that's gotten hit, that is where the research comes in to let us know whether to get some exposure. An ugly duckling for sure is software tech companies that have gotten hit here recently. Some of them may not survive if they're not able to adapt fast enough. Even a big company like Microsoft could be massively disrupted. Basically, this is about time in the market, not timing. When you get to a time like this where you start feeling a little sick to your stomach because you're feeling the bumps, recognize what that really is, right? Recognize that this is a long-term planning process. This is not about only what's happening right now. 

With that, we appreciate you, appreciate our clients, appreciate our team. We are here for you to answer any questions when times are volatile or when they're not. We wanted to reach out today because there are some bumps and we're up in the cockpit. We can tell people might be a little nervous in the back. Thanks for your support and have a great week.

We love feedback and we'd love it if you would pass it on to me directly at josh@keystonefinancial.com  Also, please stay plugged in with us, get updates on episodes, and help us promote the podcast by rating us five stars and subscribing to us at Apple Podcasts, Spotify, or your favorite podcast service.

The opinions voiced in the Wiser Financial Advisor show with host Josh Nelson are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine what may be appropriate for you, consult with your attorney, accountant, financial or tax advisor prior to investing. Investment advisory services offered through Keystone Financial Services, an SEC Registered Investment Advisor.