As the dust settled from yesterday’s near-implosion of the stock market, we saw the end result of a pointless panic and rush on the markets. In all, nearly $1.2 trillion in value was lost through the mindless selling across all sectors. If you didn’t sell then - and I hope you didn’t - it’s certainly too late to sell now.
So what to do now that you’re stuck with a portfolio that dropped at least 7% in one maddeningly painful day of trading? Sit on it and rejoice! In fact, you should be seeing this as an opportunity to buy. And today, that’s what they did.
Monday’s markets sunk by 7% to 10%, but on Tuesday the markets rallied back around 5% - erasing half of the loss from Monday. That doesn’t mean the roller coaster ride is over, but it does signal that people didn’t completely lose their minds yesterday when the House decided not to pass the (poorly-conceived) bailout bill.
Of course, Congress is going to try again. While I believe any bailout is a bad idea, hopefully they’ll take this failure as an opportunity to fix the deficiencies in the current bill. Until then, the markets will continue to churn, so just hold on tight and enjoy the ride. There’s no getting off now!
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