Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

“Fiscal Cliff” Looms

If there ever was a dominating headline of the day - it is this one. Are we really supposed to think that there is some point in time in the near future where we just fall off the face of the earth? Didn't some explorer figure out that the earth is round centuries ago? In the same way, the financial world is round as well - round in the sense that life is just one big cycle after another. As long term planners we see this every day and twice on Sunday (old expression my dad used).

Remember October 1929? December 1941? November 1963? August 1974? October 1987? September 2001? September 2008? You recognize most, if not all, of these dates instantly because the events associated with them became mental milestones that you simply cannot forget. What did they all have in common? The stock market indexes sank and many individual investors (and "professionals") panicked because of their lack of understanding that markets were declining temporarily before continuing their permanent long term advance.

Now, the way the media is hyping the expiration of the Bush tax cuts - which may or may not occur- you would think that the same type of seared-memory event is in the offing for January 1, 2013 - that it too will become one of those infamous dates. (And that is assuming we make it past the Mayan Calendar "end of the world" scheduled for December 21st).

Well, hold on. Let me see if I can shift the fear and victimization that is always the undercurrent of news reporting. Check out some other things going on that give rise to long term economic optimism ….

  • The USA will keep beating China. With all the hype China gets concerning their economy, the big headline this week was that the new leaders there are pro-economic growth. No kidding! Wow, that is amazing. I did not realize they had to announce that. I was just assuming that every country was pro-growth. Know this: China is a mere ~2% of the global equity on the planet. The USA is ~48%. The Rule of Law in China is much weaker than in America. The world's reserve currency is still the dollar. Those three points alone make for a continued USA winning streak.
  • Shale oil extraction and natural gas discoveries of the last several years are enormous. The potential for millions of additional jobs in the energy industry and indirectly in other industries - including reigniting manufacturing with cheap energy - are huge.
  • There is enough money sitting in all money funds to buy the 120 largest companies in the S&P 500 ($9.5 trillion). That money is going to buy something at some point. I am willing to bet that a large portion will be invested via the securities markets in the great companies in America and the world. (The same ones you own in your super-diversified portfolios).
  • I was visiting with an 82-year-old client the other day and mentioned that the day he was born the S&P 500 Index closed at 18. Today it is above 1400. And that does not include eight decades worth of dividends. Enough said.

Does the world have problems? Yes. Don't get me started. But as financial planners, we are concerned with your personal economy- those things we can control. The fact is… the world is not flat financially. There is no cliff, if for no other reason than the government is notorious for implementing retroactive solutions on legislative tax matters. So please remain calm and cogitate on the long term, positive outlook I just mentioned. You will not get this in the mainstream media. Optimism is boring. Nobody would watch.

"The wind is never for the sailor who knows not to what port he is bound."

-Og Mandino