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THE EXTRAORDINARY VOLATILITY OF THE STOCK MARKETS

THE EXTRAORDINARY VOLATILITY OF THE STOCK MARKETS

| March 02, 2020
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Last week, the stock market plunged more than in any week since 2008 during the housing crisis. Days of plunges approximating 1,000 points happened more often than not last week. The Coronavirus, COVID-19 is playing havoc, but it's with our psychologies and not with our economy. At least not yet.

Whether COVID-19 spreads like wildfire or not, whether its' mortality rate is high or low... no matter what the effects of this virus will be, it is, at least as far as the investment world is concerned, temporary.

I'm not here to show any expertise in regards to the virus. I don't have it. But I do have a lot of expertise in the investment and finance world, and what I'm about to say is my own professional opinion. You know the disclaimer... nothing's guaranteed. 

Last week's plunge was temporary. Today, as I write this, the Dow 30 (the index the vast majority of people hear reported so often) is up 764 points. Who knows.... it could be down by the end of the day, or up over 1,000 points. Right now, the thing to keep in mind is that eventually, while the virus could upset our economy and commerce, the volatility isn't happening because of anything other than the fears of the virus, or the results from reacting to the virus (travel and commerce restrictions). It's all virus related. And once the virus isn't a threat, things will stabilize, including the equity (stock) markets.

As of this writing, there's already about 20 vaccines they're working on. One is ready for human trials. This is just my own personal opinion, but I do believe, at some point, they'll get a handle on this and we'll find stabilization.

I'm not here to throw sugar all over a pile of garbage and tell you it tastes great. You should take proper precautions, as far as doing all the things the science and medical professionals tell you to do in regards to prevention of this disease. But you shouldn't panic, about the disease or the investment markets. Be prepared for both. Expect volatility. Expect the markets to roil downwards and upwards, and maybe downwards first for awhile. Keep your hands and counters clean and whatever else they suggest you do, and as always, whether there's a virus going around or not, your portfolio's risk level should match your comfort level, not only in regards to your needs, but holistically too.

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