Yesterday I wrote about why it's important to prepare for an uncertain future. It's tough to predict where we'll be (and who we'll be) in five or ten years. It's even tougher to predict what's going to happen in the world around us. In order to cope with this uncertainty, it's important to be adaptable — and to prepare for the worst (while expecting the best).
I was reminded of this advice again this morning as I read several articles in a row about the insane rise of Bitcoin and the current bull market in stocks, which is one of the longest in U.S. history.
Here's a graph of the rise of the S&P 500:
Here's a graph of the value of Bitcoin:
And, just for kicks, here's a graph of the U.S. unemployment rate (in this graph, lower numbers are better):
You can look at just about any economic indicator over the past decade and produce similar graphs. Despite what certain incessant whiners say, we've experienced a period of sustained wealth and prosperity. That's awesome!
If you've spent all (or most) of your adult life in this economy, you might believe it's always like this. You might believe the stock market always goes up, jobs are always easy to find, and every day is sunny.
But it doesn't work like that. [Read more…]