Don’t Forget to Breathe

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When working with finances, we sometimes find ourselves tensing up, filled with anxiety and unsure about how to continue. That reaction isn’t just limited to financial situations, of course. The other day I recalled when I started to learn to climb and my then-instructor (now-husband) yelled down to me “Don’t forget to breathe!” when I was stuck, unable to figure out my next move. The instruction was just what I needed in order to step back (not literally) and look at my situation with a clear head. I hadn’t realized I was holding my breath, thereby depriving my brain of oxygen and speeding my heart rate up, which was not a good thing considering I had almost a rope length to climb yet.

Even small financial problems can sometimes feel like impossibly high walls to climb up. It can help to take a moment to step back from a financial situation, letting ourselves breath, and giving ourselves the space to look at it if all angles. Ask yourself: what is the best fit for the solution? Is there something you may have missed that you didn’t see the first time? Oftentimes we don’t need someone else to answer our financial questions; we just need someone to remind us to breathe so that we can recognize the solution right in front of us.

Breathing slowly and with control can apparently benefit more than your financial health! The Wall Street Journal article Breathing for your Better Health has excellent information on the benefits of controlled breathing to your mental and physical health (and a bit of the science behind it). If you don’t think you can change your breathing patterns on your own, Spire is a device you can clip on to your pants (or anywhere close to your body) which tracks your breathing patterns in order to tell you when you are too tense or anxious. Any way you go about, taking time to breathe can’t hurt.

Those looking at our economic outlook seem to be breathing easier as well. The most recent Global Economic Outlook panel was held at the World Economic Forum on January 24th. David Ashworth of Market Realist headlined his report on the panel discussion with: Could 2015 be a ray of hope for the world economy? He detailed the panel speakers’ reasons for their positive outlook: the upside of the European Central Bank stimulus, falling oil prices, structural changes in Brazil, China and Japan, and robust growth in the United States.

For the last several months we have been watching the Eurozone and the energy sector. Richard Bernstein, CEO and Chief Investment Officer of Bernstein Investments, shared with his audience that many observers may be overlooking related issues that he thinks are worth considering, including cash flow and dividend payments. Bernstein also reminded his audience that risk cannot be completely planned for – by definition it is unexpected.

We do plan our trips though. And if you have recently planned a trip to Canada (or have just followed the exchange rates) you would be aware that the Loonie is about 80 cents to the US Dollar. This means that any retailer / small business owner in Canada needs more cash to purchase US goods. The strong US dollar is of concern in other international countries as well. Having a strong currency will make our country less competitive in goods and services but it may help out the mid-size and smaller countries that do not usually export their finished product. Frank Holmes of US Global Investors went into more detail on this subject in his recent blog post. In the end, businesses are like families, in that we need to prepare for the unexpected, watch our cash flow and review the plan to determine if we have overlooked any items.

The New Year started with a second monthly decline for the market and ended January on a sour note. The blue-chip barometer (the DowTR)* showed a 3.46 percent loss. The S&P 500 Index (SPXTR)* recorded a negative 3.0 percent for January. Lastly the tech-rich Nasdaq Composite (COMPTR)* fared the best but still back-peddled -1.93 percent.?Home price gains are slowing down nationwide. The S&P Case-Shiller 20-city composite?Home Price Index reported 4.3% for the month of November on a year-over-year basis; again down from the prior month?s 4.5% adjusted increase. Monthly data for the month of November over the month of October showed a slight downturn of 0.1%.

Best Regards,

The Team at White Raven Financial

*Indexes are unmanaged and do not reflect service fees, commissions, or taxes. You cannot invest directly in an index. Past performance is not necessarily indicative of future results. Returns for the DOW and the S&P500 are total returns from Pershing Netx360. Return for the NASDAQ is the NAV total return provided by Morning Star as of 2015January31