Markets in (semi)Panic 3: not even a semi-panic yet
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Every now and then, I'll write a "markets in Panic" post. It's generally on the heels of a 10-20% decline when people are freaking out a bit. The last one I did was in December 2018. That post didn't quite mark the bottom; the market would drop another 5-7% over the next week before bottoming on Christmas Eve... but the post was decently close to the bottom. As I said in that last post, writing is a little cathartic for me, so I wanted to put a post up after a rough couple of days over the past few days. Not because I think we're at a bottom or anything. Markets could open up or down 2% (or 5%. or 10%!). I don't know. But because writing helps me think and process. First, let me start with the obvious: while markets are down ~5-7% over the past few days, it's tough to call whatever is going on now a full blown panic. Even after the meltdown of the past two days, stocks are only down ~5% for the year. Given how much they were up last year, markets are basically a rounding error from all time highs. Being within touching distance of all time highs and down just 5% for the year does not exactly describe a panic! As the blog's title suggests, I don't even think this qualifies as a semi-panic yet! (Russell 2000 YTD return below)
Markets in (semi)Panic 3: not even a semi-panic yet
Markets in (semi)Panic 3: not even a…
Markets in (semi)Panic 3: not even a semi-panic yet
Every now and then, I'll write a "markets in Panic" post. It's generally on the heels of a 10-20% decline when people are freaking out a bit. The last one I did was in December 2018. That post didn't quite mark the bottom; the market would drop another 5-7% over the next week before bottoming on Christmas Eve... but the post was decently close to the bottom. As I said in that last post, writing is a little cathartic for me, so I wanted to put a post up after a rough couple of days over the past few days. Not because I think we're at a bottom or anything. Markets could open up or down 2% (or 5%. or 10%!). I don't know. But because writing helps me think and process. First, let me start with the obvious: while markets are down ~5-7% over the past few days, it's tough to call whatever is going on now a full blown panic. Even after the meltdown of the past two days, stocks are only down ~5% for the year. Given how much they were up last year, markets are basically a rounding error from all time highs. Being within touching distance of all time highs and down just 5% for the year does not exactly describe a panic! As the blog's title suggests, I don't even think this qualifies as a semi-panic yet! (Russell 2000 YTD return below)