Headlines such as this one make it sound as though vast amounts of money have been destroyed without any possibilty of recovery, ever, and in my opinion they feed the fear of those who do not understand how markets work. Those numbers that appear on brokerage statements are not bank balances; they reflect only the market value of securities at the time of the statement and are subject to constant fluctuation, down as well as up, sometimes way down and sometimes way up.
Granted, a severe market plunge will take a terrible toll on those who were counting on being able to sell those securities at their former values in order to pay their living expenses in the near future. But if this plunge is like past ones, market values will eventually rise again and those “evaporated” savings can be restored if people are not panicked into selling, tragically, at what turn out to be market bottoms.
That said, it’s hard to grasp the magnitude of the current crisis and I don’t know that it won’t be far more serious that previous ones. If it is, may the Lord have mercy on all of us. In the meantime, I’m holding onto my good quality stocks and waiting to see how it all works out.
the silver lining in this is that people will stay in the workforce longer – given increased life expectancy, it makes sense. and remember, the bible does not talk about retirement in the way that we have come to understand it.
Headlines such as this one make it sound as though vast amounts of money have been destroyed without any possibilty of recovery, ever, and in my opinion they feed the fear of those who do not understand how markets work. Those numbers that appear on brokerage statements are not bank balances; they reflect only the market value of securities at the time of the statement and are subject to constant fluctuation, down as well as up, sometimes way down and sometimes way up.
Granted, a severe market plunge will take a terrible toll on those who were counting on being able to sell those securities at their former values in order to pay their living expenses in the near future. But if this plunge is like past ones, market values will eventually rise again and those “evaporated” savings can be restored if people are not panicked into selling, tragically, at what turn out to be market bottoms.
That said, it’s hard to grasp the magnitude of the current crisis and I don’t know that it won’t be far more serious that previous ones. If it is, may the Lord have mercy on all of us. In the meantime, I’m holding onto my good quality stocks and waiting to see how it all works out.
the silver lining in this is that people will stay in the workforce longer – given increased life expectancy, it makes sense. and remember, the bible does not talk about retirement in the way that we have come to understand it.