You Asked, So We’ll Answer
FOQ: This tariff drop – is it different this time?
Short: Nope
Long: The market drops for many different reasons. But most importantly, it ALWAYS drops:
Nothing new here. The takeaway is that after every single big drop, the market has hit a new high. Every single time.
So when you say “It’s different this time”, know that it’s not the reason that matters. It’s the outcome. And the outcome has never been different. We recovered and went on to new highs.
FOQ: Why does it hurt?
Short: Biology
Long: As the great Jason Zweig wrote last week in the WSJ:
“Intense uncertainty automatically triggers fear and stress in the human brain, infusing our bodies with the ancient fight-or-flight response that is essential to survival. Fear fixates our attention on the negative, makes us acutely sensitive to social signals, impedes our working memory and impairs our ability to think flexibly.”
We’re still just cavemen!
FOQ: What should I do?
Short: Nothing
Long: More from Jason:
“To prevail over this chaos, you must think clearly at a time when many investors—and policymakers—are an emotional mess…Normally, investors can consult data from the past to put a crashing market in perspective and calm their fears. But nothing like Trump’s trade war has happened in nearly a century…That’s why thinking clearly right now is harder—but also more important—than ever.”
Think, do not feel. Choose logic over emotion. It’s OK to be scared. It’s not OK to act on that emotion. Then you will have made the damage permanent.
Easier said than done, right? That’s why you have us. It is easy for us. So lean on us. Call us. Let us do our job for you and this will all pass. As it always has. The chart proves it.
Cheers,
Your Great Oak Team