If you left for a camping trip and unplugged from everything Thursday, March 9 and the first thing you did upon your return a week later on Thursday, March 22 was check the stock market, you wouldn’t think that one of the largest bank failures in American history occurred.
You’d see that the stock market held up while you were gone. While the Nasdaq was up, the S&P 500 and DOW was essentially flat.
You’d probably hop in the shower and get cleaned up.
Once you got the leftover food put away, ice chests cleaned out, and laundry loaded, you might sit down and hop on your iPad to catch up on your news and social media feeds.
You would then get a barrage of rather bleak banking articles and various pontifications on financial woes.
After doublechecking the stock market indexes, convinced that you read it wrong the first time and that it must be down 10-20%, you’d take a deep breath, happy and flabbergasted.
Enough fictional hypotheticals.
Here’s the deal. Could this banking crisis get worse? Yes.
Will it? I don’t know. Maybe it has by the time you are reading this.
We’ve seen crises before. Ups and downs in financial history are normal. We expect them. You should too.
Are they easy? No.
But we are here for the long term.
Erratic reactivity doesn’t usually pay off in life or investing. We believe that investing is gardening, not gambling.
Remember that when it comes to any “crisis,” politicians want you to vote for them; news feeds and channels want to entertain you, scare you, and anger you; and advertisers want to keep you watching and clicking.
All of them capitalize on crisis. Unfortunately, not always for the common good.
Focus on what you can control. Tune out the noise.
Know your risk tolerance. Have a plan. Ask for help when you and those you love need it.