What I Learned from the Last Crash

The market volatility of the past three days has caused me to think back to the last major stock market crash in 08/09.  Here's what I learned from then:

The  new Fed chairman will make a mistake.   Back in 2006, Ben Bernanke claimed there was no subprime mortgage issue and did not address it.   He was a new Fed chairman at the time.  Janet Yellen has been chairwoman for less than a year.

It will get worse before it gets worse.   Monday's volatility will be repeated many times. Monday's lows will get taken out.

The market will take a while to bottom, up to several months.   During that time, being in the market will be extremely painful.

The market will recover and reach new highs, as it has from every other bear market.

My plan for now is to keep our current investments and add funds with every 10% decline in the market indices, with a target of being fully invested around a 50% decline.  While good in theory, I expect the plan will be difficult to execute as our current stock investment values are reduced by 50%.

For more on Strategies and Plans, check back every Monday  for a new segment.

This is not financial advice. Please consult a professional advisor.

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