Tariffs and Temporary Trials
How to handle this time of economic uncertainty.
“We’re taxing penguins now?”
It has not been a great week for investors. The Dow Jones dropped more than 2,200 points. The S&P hit close to a double-digit percentage loss.
I’ve gotten 3 phone calls from my broker and just as many emails about reviewing my portfolio.
The internet is losing its collective mind.
Am I concerned? Abso-freaking-lutely.
Am I going to stay the course? You betcha.
Aww… Another Recession?
Investopedia defines a recession as “A significant, widespread, and prolonged downturn in economic activity.”
Are we in one now, or on a death march toward one? It doesn’t sound like anyone can agree.
As a proud card-holding member of the Elder Millenials, I’ve had the privilege of living through five recessions and I gotta tell you something.
I’ve come out the other end of each one of them just fine. Sure, I was an infant for the 1981-1982 recession and watching the original Teenage Mutant Ninja Turtles animated series during the early 1990s recession. But I was definitely impacted by the proceeding recessions when it came time to find work after graduating from college and to look for a home around the subprime mortgage crisis.
This isn’t a post about politics so you might want to look elsewhere if that’s what you were hoping for. This is a post about keeping your cool and not letting emotion wreck your well-laid plans.
This Is Fine
Here’s how to stay level-headed about the current economic turmoil.
First, take the long view. Unless you’re clocking in on Monday and handing in your formal retirement notice, you’ve probably got some time for the market to bounce back. If all goes to plan, I should be able to retire early and even then I would still have a good 10-15 years until I’ll be sitting on the beach with a Mai Tai permanently by my side. (That’s not even how I picture retirement. I assume that’s the stereotypical view of it though.) Anyway, that’s still plenty of time for the market to bounce back.
Second, stop looking at your portfolio. Or at least stop checking it daily. I really write this one for myself. I am addicted to looking at my accounts multiple times a day. It is an exercise in futility and annoyance. Even if I lost 15% or 20% in a day, what would I do about it? I’ll tell you.
Nothing. Nada. Zilch.
Parts of my portfolio are managed by robots. Other parts are managed by smarter human beings than me. Guess who isn’t doing any of the management? Me.
Unless you’re a successful day trader (is that an oxymoron?), you most likely wouldn’t benefit from flipping through your account balances as if you were a tween flipping through #hopecore TikToks.
Third, you might want to find a hobby. Okay, this one was going to be about stopping your consumption of social media and news, but that’s actually really difficult to do. I like scrolling through parody #hopecore reels so I need to put up with the occasional news cycle rage bait. So instead of all that, go do something you really love and get your mind off of the perpetual impending state of doom our economy always seems to be facing.
Read a book. Learn an instrument. Watch Kingdom of the Planet of the Apes. (Honestly it was really good. I probably shouldn’t check how it did on Rotten Tomatoes.)
We don’t get that much time here on planet Earth. Might as well use it to better yourself or better the rest of humanity.
(Oh wow. Kingdom of the Planet of the Apes was actually Certified Fresh on Rotten Tomatoes. Who would’ve thunk?)
Cowabunga!
Regardless of which uninhabited island in Antarctica we impose a tariff on next, just take a chill pill. (I know. I know. My Elder Millennial is showing again.)
Do things kinda suck right now? I mean, sure. We’re literally able to make installment payments on Chipotle burrito bowls now.
But if you’ve already made a plan for how you’re going to handle your finances, continue to work that plan. Heck, maybe buy more stocks. I certainly haven’t changed or stopped my scheduled purchases of stocks and crypto.
When the stock market is down, it’s a great time to buy. When the stock market is up, it’s a great time to build wealth.
Whatever you do though, please don’t mortgage your next Double ShackBurger and bacon cheese fries.