Roaring 20s?

In 2021, references to our current decade as “The Roaring 20’s” began to appear everywhere. It is a fun historical nickname, but it also seemed appropriate. The world emerged from the first modern pandemic into one of the strongest economies on record. Businesses were booming, unemployment was at a record low, and the stock market closed at a new all-time high 70 times that year.

This year feels like everything has changed, and everyone has given up on the idea that this decade could be “Roaring” or anything close to it.

In truth, unemployment has not climbed much, and many businesses are still reporting record quarterly earnings. Still, the sentiment has shifted drastically for many reasons, and the clever nicknames have disappeared.

When we find ourselves in spots like this, it is helpful to consider how past decades are remembered. For example, do we remember the 2010s as a fabulous time for business growth where the U.S. stock market increased 13.5% per year, or do we remember a decade of political division and conflicts?

Was the first decade of the 2000s the “Lost Decade” of 9/11 and the housing market collapse, or was it the decade that made our lives tremendously better by bringing us the iPhone and countless other indispensable technologies we use every day?

Consider how you remember the 90’s, 80’s, or 70’s. Even if we didn’t live through some of those years, certain events likely come to mind. Were these thought of as good times or bad? And did that view change over time? Like most things, it can be argued either way, depending on how you look at it. The same will be said for our current decade once everything is said and done.

It’s not hard to find someone pessimistic about 2022. Finding someone ready to throw in the towel for the remainder of the decade is much more difficult. We must remember to keep these extended time frames in mind and avoid knee-jerk reactions to short-term events if we want to be successful long-term investors. Most of our financial plans extend well beyond this current decade, but it is easy to get caught up in the noise of a bad headline.

The only thing for sure is that there will be more good and bad news this decade. Therefore, a long-term mindset is the easiest way to alleviate some of the current negativity.

So, will we look back on these years as the Roaring 20’s?

While this year has been challenging, I remain optimistic about where the decade ends.