Keep Your Shirts On

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The US stock market has seen some amazing drops over the past week. Roughly 4000 points and counting, and it might cause some to drop their jaws a bit, rip their shirts off, and run for the nearest rooftop from which to leap. But we have been here before, and for very similar reasons. Outbreaks and virus scares. Even barring those, we have seen 10% drops or more for a variety of reasons—at least 14 times. In all cases, every single one, not only did the markets return to normal, they averaged higher than average gains. The only thing I can stress here are the fundamentals. That is what you look at. Just because the entire market decides to get their panties all in a bunch does NOT mean that every single company in the market has seen its fundamentals change. This is especially true when these steep declines have nothing at all do with sales, profits, consumer demand, or the economy as a whole. Not a single thing. So, all this is is an opportunity to look for bargains and buy into those. If you have a 401k, I recommend increasing the percentage of your contribution for at least the next two months. As for selling? You should not be selling a SINGLE share of anything right now. Not one. The losses are all on paper right now. They only become real losses if you pull the trigger and actually sell into the selloff.