For a couple of days last week, the stock markets seemed to be behaving as if it was suffering from some horrible chronic illness. But then Wall Street bounced back and behaved as if the problem had just been a hang nail. Today, the market has crawled back in bed.
For all of us invested in stocks, volatility is something we have to live with. If you ignore the day to day temperature of Wall Street, however, you will be much better off. You may feel better about the ups and downs if you look at this historical chart. It shows just how quickly the market has rebounded after major crisises, such as President Kennedy’s assasination and the bombing of Pearl Harbor.
Some pundits say it will be months before we know the full impct of te sub-prime mortgage problem.
Some gurus suggest leaving even money funds for treasuries to escape the risk. What say you?