As seen in

U.S. Debt Ceiling: Is it time for extraordinary measures?

Recent headlines have investors concerned about what may happen to their portfolios if the U.S. government cannot reach an agreement to increase the debt ceiling/limit, thereby risking default:

The reality is that headlines like these are nothing new. In the historic global market growth of wealth graphic below, we highlighted every major “impending disaster” as it relates to the debt ceiling/limit since 1975. We did however, skip adding in the wars, recessions and global pandemics because it just seemed like the chart was getting….kind of busy.

If you scroll through the narratives corresponding to the yellow and red indicators in the source link (here and below the graphic), you’ll find plenty of unprecedented situations and a curiously recurring use of “extraordinary measures.”

http://go.efficientadvisors.com/e/91522/debt-limit-through-the-years-/937dnk/1930271872?h=1kLUMoSzhGNSHlCeK4VhnNvjV8rgObzau7qaI1GJivc

As the graphic indicates, markets have endured many debt ceiling/limit “political exercises” in the past and there should be no reason to believe that they would not going forward.

Other Fun Facts:
Depending on who is doing the research, it is said that the U.S. has raised its debt ceiling (in some form or other) at least 90 times in the 20th century.

In any event, the debt limit has NEVER been lowered…

Reminder:
History’s evidence reminds us that using today’s headlines to predict short-term market outcomes correctly is exceedingly difficult. The strategies we implement aren’t designed to anticipate the unknown future – they’re designed to endure it.

Invest with evidence.

Disclosure:
This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. All information is believed to be from reliable sources; however we make no representation as to its completeness or accuracy. All economic and performance data is historical and not indicative of future results. Market indices discussed are unmanaged. Investors cannot invest in unmanaged indices. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This material was prepared by Efficient Advisors, LLC (“EA’) for Mark Lund, Mark is a Financial Advisor in Utah. He is known as a Wealth Advisor, The 401k Advisor, Investor Coach, Financial Planner, Investment Advisor and author of The Effective Investor. Mark offers investment advisory services through Stonecreek Wealth Advisors, Inc. a fiduciary, independent, fee-only, Registered Investment Advisor firm providing investment management and retirement planning for individuals and 401k consulting for small businesses. Mark’s newsletter is called The Effective Investor Newsletter. Cities served in Utah are: Salt Lake City, Salt Lake County, Utah County, Park City, Murray City, West Jordan City, Sandy City, Draper City, South Jordan City, Provo City, Orem City, Lehi City, Highland City, Alpine City, American Fork City. The views expressed herein are exclusively those of Efficient Advisors, LLC (‘EA’), and are not meant as investment advice and are subject to change. All charts and graphs are presented for informational and analytical purposes only. No chart or graph is intended to be used as a guide to investing. EA portfolios may contain specific securities that have been mentioned herein. EA makes no claim as to the suitability of these securities. Past performance is not a guarantee of future performance. Information contained herein is derived from sources we believe to be reliable, however, we do not represent that this information is complete or accurate and it should not be relied upon as such. All opinions expressed herein are subject to change without notice. This information is prepared for general information only. It does not have regard to the specific investment objectives, financial situation and the particular needs of any specific person who may receive this report. You should seek financial advice regarding the appropriateness of investing in any security or investment strategy discussed or recommended in this report and should understand that statements regarding future prospects may not be realized. You should note that security values may fluctuate and that each security’s price or value may rise or fall. Accordingly, investors may receive back less than originally invested. Investing in any security involves certain systematic risks including, but not limited to, market risk, interest-rate risk, inflation risk, and event risk. These risks are in addition to any unsystematic risks associated with particular investment styles or strategies.

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