The numbers coming out of Wall Street this week have left much to be desired and a lot of investors have found themselves struggling over the past few days, wondering if now is the time to get out. Believe me I get it… And I’ve had those thoughts before myself. When the market crashes, it can definitely be a scary thing. I’ve lived through enough crashes in my time to have learned a thing or two about getting through them. But before you make any rash decisions, do yourself a favor and keep reading…
The Good (and Bad) Times
Despite what my grandkids may think, I’m not quite old enough to have first hand details of the market crash of 1929. But, if you want to hear a personal story about the single worst day in Wall Street history, I’ve got just the one you need to hear right now…
It was October 19th 1987 (more commonly referred to as BLACK MONDAY.) Black Monday is now known to be the single worst day in U.S. stock market history and, folks, I was right in the middle of it.
Now, by the time 1987 had come around I’d been working in the markets for quite some time. In fact, not only was I working in the market, but like so many other investors during the 80’s, I felt like I WAS the market. I’d had year after year of successful investments and that pattern of winning had afforded me what I considered a pretty extravagant lifestyle. I had a nice house, luxury cars, designer clothes… you get the picture. I felt like I was on top of the world.
Well, I’m sure you can guess what happened next. (If you guessed that I lost it all, you WIN!) Talk about a bad case of the Mondays… By the end of that fateful October day, the lifestyle I had made myself accustomed to was flushed down the toilet and I found myself back on square one.
These are the types of stories so many of us are used to hearing about market crashes and it’s because they really do happen. One minute, the world is yours and the next you’re in the unemployment line. For me, I always knew the market could be a tricky place but, through the 80’s there was just so much success going around that many of us felt we could do no wrong! So when the end finally did come, it hit us that much harder.
By the end of the day, we couldn’t believe what had just happened. A true market disaster right before our very eyes. But like so many other disasters, Black Monday did have its survivors and I’m lucky to say I was one of them. And that’s the REAL story I’m here to tell you today… the story of my survival!
The Aftermath
I will admit, it did take me a while to recover from Black Monday – not just financially but socially as well! You see, a hit like that does terrible things to your confidence and mine was completely shot. But in the end, I did recover. I became better educated on the markets and my investment strategies became stronger and smarter.
By the time 1996 came around I was doing so well that I was encouraged to start this very company to help spread the knowledge and wealth that I had accrued in the post Black Monday world. And I’ve been successfully doing it ever since!
The Wrap Up…
For most, when we hear the phrase “crash” we think about losing a lot of money. And if you just read my story, you know exactly why that’s the first thing to come to many minds. But don’t let this “crash” phrase intimidate you too much. Despite the many stories like the one you read above, a market “crash” really just means a change in the market’s direction. That’s it! If we understand how to prepare for this directional change and position ourselves the right way, we can make money from the market, despite any sudden changes! I now see that’s where I went wrong in 1987. I was only interested in the market going one way and when it changed course, I suffered. But even though I had to learn my lessons the hard way, I did learn them and it’s these lessons that helped me get through the future crashes that I would find myself facing in years to come.
So, if you find yourself nervous or a bit hesitant going into this market, you’re not alone. But I encourage you to remember these words of wisdom… Persistence pays off. Do your research, stay focused, and persevere. Follow these rules and you’ll be alright. And when we do hit those inevitable bumps in the road, just remember, times may be tough, but we’re all in this together.
See You on the Flip Side!
-Tom
P.S. – If you’re interested in learning other ways the DTI team can help you through unpredictable times like these, CLICK HERE!