Why I ignore the crash

 

Markets iffy last week but my shoulders shrug. I have a fixed price target for my portfolio, so what with all the market collapse my growth projection has increased. Moreover I discount all my future liabilities (paying gas bills, Sainsbury’s, ‘biting on granite’ worktops, garden shed, phone, new pair of trousers etc) by the same growth rate so my overall position is unchanged.

We should all do this.  After all, that’s what the Bank of England recommends.¹

1. I’m being cryptic. What the Bank’s paper suggests is that in a crash, perhaps the next crisis, the value of debt held by banks, insurers etc will fall in tandem with the value of their assets, so the crisis won’t exist. Nothing to see here, don’t panic, move on etc.