Thinking long-term when the market is wild

"So how should one manage money in an era of unpredictability and volatility?" asks a story on the front page of Monday's "Money" section in USA Today.

The Dow Jones industrials' 261-point plunge Friday sparked by a sharp drop in consumer sentiment in July highlights that gloominess persists....In recent weeks, a spate of economic reports have come in weaker than expected, fueling double-dip fears. In July, readings on manufacturing, retail sales, factory orders, employment, auto and home sales came in light. Last Wednesday, minutes of the Federal Reserve's June meeting indicated it expects growth to slow in the second half, prompting the central bank to lower its 2010 growth outlook to as low as 3%.

In the words of former Fed chief Alan Greenspan, the economy has hit an "invisible wall."

Whew! How should investors respond?

On a recent Faith Meeting House program on Alabama's Faith Radio, SMI assistant editor Joseph Slife (right) talked with host Bob Crittenden about the maintaining a long-term perspective when the short-term is unsettling.

Use the audio player below to listen (16 min.) - or download an mp3 (Windows users: right click, then "save link as").

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Matthew Pryor in his 8th year with Sound Mind Investing, now serving as Director of Operations. Get a Free 30-Day Trial during the month of July.