C’mon. Did anyone really expect an outcome other than what happened with the Super committee deliberations? Perhaps if you were on another planet. This was “political expediency” at its best: avoid tough decisions that could roil voters and seek political “cover” by pushing the issue on to the entire Congress. So now what? The President has said he will veto any attempts to avoid the automatic spending cuts that kick in in 2013, setting the stage for more DC high stakes political drama. You know it’s going to be an ugly process. Market implications? Continued news-driven volatility. The economy? It will most likely continue to muddle along as will corporate earnings, which offers support for equities, in our view. We are encouraged that recent U.S. economic data supports a moderately improving outlook. Outside the U.S., the ugly process of European debt restructuring will take more time and, of course, adds another element of uncertainty and volatility. So what does it mean for financial planning? While we think the long-term outlook for the U.S. is bright, the level of investment uncertainty near term remains high.  With higher market volatility expected to be around for awhile, we advocate having a financial plan that provides a long-term roadmap for your investments and portfolio strategy. It means keeping your eye on the long-term goal and not being overly influenced by short-term swings in the market, both up and down. A sound financial plan can help you stay on course for the long term. It’s like planning anything else in your life: would you start a business without a business plan? And a sound financial plan can address and mitigate portfolio volatility through appropriate asset allocation, sector diversification, and regular plan reviews.

 BT for S.R. Schill & Associates, Mercer Island, WA