I have been asked by many over the past few days: “What do I do now?” I find that question particularly painful, as I have been warning for the past few months that a decline in the market was on the horizon.

Read my recent columns, begging people to make sure they have enough “chicken money” on the sidelines in safe T-bills and short-term CDs and money market funds so they don’t panic and sell at the bottom.

Well, it doesn’t look like the bottom is here yet, though the market has taken a brief sharp bounce. The long-term and widespread impact of the tariffs, will impact future business activity, hiring decisions, sourcing decisions, and consumer confidence – which was already on a sharp decline.

That does not bode well for the stock market regaining its previous peak any time soon. In fact, the chart below shows just how DEEP a bear market can go, and just how long it might take to recover.
[Full chart here at Investopedia: https://www.investopedia.com/a-history-of-bear-markets-4582652]
Bear Markets: Depth and Time to Recovery
1973 -48% 6-years
2000 -49% 5 years
2007 -56% 4 years

I have no crystal ball about the depth and breadth of the current market decline. But the administration has continually reaffirmed that they are willing to “take the pain” of a recession in order to get to what they believe will be manufacturing job growth in the future.

I’m not here to debate politics or economic theory. I’m just trying to protect your finances – and your sanity. There is nothing you or I can do to change what’s coming (except perhaps make your feelings known to your representatives).

What you can do is NOT PANIC and NOT FREEZE. Look at your investments right now. It’s not just how much farther down the market can go. It’s about how long it might last. And whether you have the personal risk temperament and the time horizon to ride this out.

Eventually the markets will come back. This is, after all, America.

But we don’t know how long “eventually” will be. Or how widespread the economic pain might be. While you might think you have enough “chicken money” on the sidelines to ride it out, what happens if your adult son or daughter loses a job in the recession? Will you have enough cash to help them buy groceries for your grandchildren?

We are in uncharted territory here. This was a calculated risk taken with our entire economic future. And the world has been drawn into this grand plan designed to restore the America of the 1950s and 1960s.

We do know that an economy controlled by government planning doesn’t have a great history of success: Think USSR in the 1960s or Cuba to this day. Government “planning” or dictates tend to lead to shortages of goods and inflation of prices. We will see if this plan to restore America’s industrial prowess succeeds or fails miserably.

In the meantime, protect yourself and your family. Build up your savings if you still have a job. Pay down your debt. Change your spending habits. Is the $5 coffee or the DoorDash delivery truly essential? The cruise you planned for summer vacation?

Yes, I know that if everyone cuts back it will push the economy deeper into recession. I can’t save the economy. But I can try to save you and the ones you love. That’s the Savage Truth!