Amid chaos, local financial planners urge investors to be patient

Local News

Discussion

January 26, 2008

By SHAWN PIATEK The Tribune-Democrat Sat Jan 26, 2008, 11:42 PM EST

Eric Kabler had a few more visitors than usual last week at his Richland Township office.

Kabler, partner at Kabler Thomas Financial Group, found himself time and time again reassuring and allaying the fears of his clients. Their concerns largely developed due to the very liberal use of the “R” word by the media when speaking about the state of the national economy.

“They’ve been stopping in all week with questions about the recession,” Kabler said.

“The obvious question has been, ‘Should we get out of the market?’

“We sort of have this preconceived idea that you get out of the stock market and get into something safer like a CD when there’s a downturn in the market. A lot of people are panicking.

“It’s the first thing you see when you turn on the TV in the evening or morning. It’s a tough time for the novice investor because they’re not sure exactly what’s happening.”

Financial advisers in the region are answering their clients concerns with the same words, “Be patient.” The worst mistake an investor can make is to panic, according to Bill Rice, managing partner of Laurel Highlands Financial Services, 109 W. Main St., Somerset.

Rice said the perception some investors have is that they have lost money because their shares are not as valuable now as they once were. He said that’s only true if an investor chooses to sell during a downturn in the market.

“We get a recession every four or five years,” Rice said. “It’s nothing out of the ordinary.

“I have been doing this job for almost 23 years and everybody that held through the recessionary periods came out on the other side and did well with their portfolio. If you sell now in a panic and your portfolio is down, you’re going to lose money 100 percent of the time.

“That’s the wrong thing to do.”

Not only are financial planners urging patience, they’re preaching that new opportunities exist.

Joe Carpenter of Carpenter Financial Services, 237 Johns St., downtown Johnstown, said that now isn’t the time to sell, it’s the time to buy.

Carpenter explained his stance by comparing the stock market to a department store. He said when the market is down it’s the same as a department store holding a sale – and the deals can be very attractive.

“Right now is what we call a stock market sale, and just like if Boscov’s or Sears had a sale, people should be running to the doors looking to get their best deals,” Carpenter said.

“In some markets, prices are down 15 to 20 percent. If you take a department store attitude and realize now is the time to buy, you’ll be better off in the long run.”

In an attempt to stem fears of a recession, the Federal Reserve Bank took decisive action last week with a cut of 75 basis points to a key interest rate. That generous cut has local experts believing even more opportunity will exist for consumers.

Jeff Philibin of Wells Fargo Home Mortgage in Geistown reported on Thursday that he closed a 30-year fixed mortgage with no points at 5.25 percent. He said mortgage rates that low have not been seen since the months following the terrorist attacks of Sept. 11, 2001.

Carpenter said falling interests rates will benefit consumers in other ways. He said people with adjustable-rate home equity loans and credit cards will be paying less interest and putting more money into people’s pockets.

“The Fed’s quick action, I think, eased a lot of the fears people had about a recession,” Carpenter said. “The lower interest rates will help borrowers, especially those with adjustable rate products, and that will free up a lot of cash instantly.

“The goal is to help consumer confidence. That’s what this is all about, getting those people spending money again buying appliances, new cars or even a home. That’s what really drives the economy in the end.”

Text Only | Photo Reprints

Local News

Lawsuit: Bedford County shooting not 'justified'
The widow of a man who a prosecutor determined committed “suicide by cop” by pointing a weapon at state police during a standoff is suing, claiming the shooting was not justified.

February 10, 2012
Book honors Flight 93 co-pilot Homer
The widow of Flight 93 copilot LeRoy W. Homer Jr. is releasing a book this month on the events of Sept. 11, 2001.

February 10, 2012
Mild winter speeds work: Entertainment venue may be complete by end of May
An unusually mild winter has accelerated construction of a new outdoor entertainment venue in Johnstown.

February 9, 2012 2 Photos
Blogging with heart
Anyone else have this issue: The more I know, the more I want to learn.
As I am writing my heart month stories for this week’s packages, I occasionally come across a term or description unfamiliar to me. So I look it up. And then the definition or article has something else that sounds important, so I look that up.

February 9, 2012 1 Photo
Man jailed on rash of charges
A Patton man is being held on $100,000 bond after police said he threatened to kill a woman, her family and himself unless she talked to him about a protection-from-abuse order.

February 9, 2012 2 Photos
Cambria abolishes 16 jobs
Following through on promises to cut budget costs, the Cambria County commissioners voted Thursday to abolish 16 positions, including nine full-time jobs.

February 9, 2012
Wozniak defends his support of drilling bill
State Sen. John Wozniak, D-Westmont, one of only seven Democrats to support the Marcellus Shale legislation adopted this week, said the bill protects the environment and provides help to local communities impacted by the natural gas drilling.

February 9, 2012 1 Photo
Businessman hoping to unseat Wozniak
Tim Houser uses two words – “challenging opportunity” – to describe his goal in this year’s elections.

February 9, 2012 1 Photo
Judge tosses evidence in robbery
A Cambria County prosecutor said he’ll have to drop robbery charges against a Twin Rocks woman after much of his evidence was suppressed by a judge.

February 9, 2012 1 Photo
Shooting defendant pleads to attempted murder
A Philadelphia man pleaded guilty Thursday in county court to attempted murder and theft in a Nov. 18 home invasion in which the homeowner was shot.

February 9, 2012
More Local News Headlines

Local News

Search Results

Discussion

Amid chaos, local financial planners urge investors to be patient

Do you support Gov. Tom Corbett’s proposed state budget for fiscal year 2012-13?

Contact Us