The stock market is tanking - Don’t Panic
The stock market is tanking right now, and with it your portfolio.
Every working person in Australia has a stock portfolio - our compulsory superannuation is invested in the stock market. As well, and more immediately perceived, you might have other investments which are taking a hit.
Aside from the stock market, we’re feeling the pressure of rising inflation, rising rates, rising gas prices, rising mortgages, and a shrinking market.
Over the next couple of weeks I am going to publish a series of articles to help you deal with the situation. Today we’ll look at the most basic advice.
Don’t Panic
First of all, take a deep breath and fix your mind on the timeless advice of the Hitchhikers Guide to the Galaxy:
Don’t Panic.
Panic is “a sudden fear that replaces thinking”. It can be useful in making a crucial split second life-or-death decision, for example causing you to jump off a cliff into a river to escape a pursuing leopard. However, right now, with no leopard in sight, it will cause you to make dangerous decisions. So don’t panic.
To help you do this, take a long view of the situation. Markets have gone up and down since history began. Whatever goes down, must come up, eventually. In the last century the 1930’s saw the “Great Depression” - a global market slump that lasted over a decade. It wasn’t the end of the world, was it? People lived through it and got on with their lives.
Of course, the Great Depression ended in a massive world war that killed millions of people…
We all hope that the present market slump won’t end like that. If it does I’ll write another article to help you out - let’s deal with crossing that bridge if we get to it. On the bright side, the post-Second World War industrial boom lead to all the neat gadgets that we have today, including the Internet.
History is cyclic - things go round and round, up and down. All you need to do is ride it out.
An exercise in developing long term perspective
Here’s an exercise to help you develop and sustain a long term view. It’s given by Krishna in the second chapter of the Bhagavad-gita .
Think back to when you were a child. See yourself at some stage of your childhood, perhaps by remembering a photograph or a memorable event. See yourself in that child body.
Now contrast that with the body that you see in the mirror in the morning. Significant differences are there, no? There’s definitely a resemblance, but it’s a different size, a different shape, and with the wonders of modern medical technology maybe it’s even a different gender - what do I know?
Your body has changed completely. Scientists tell us that every seven years all the cells in the body are completely exchanged for new ones as the old ones die and are shed. While that complete change of body has taken place several times, there is an aspect of your core identity, your self, that remains you. Krishna describes this as the soul, and tells Arjuna in Bhagavad-gita that this core identity is eternal, while the body is temporary and changing.
Things change around us, outside us, including our body, but we go on. After this body is finished we are not finished. Ultimately everything in relation to this body will go by the influence of time, but our self remains, eternally. So there is no sense in becoming overly attached to the temporary fluctations of the material world. That’s not to say that we should become irresponsible, but at the same time - it all has to go sometime. At the same time, our persistence through all the changes thus far demonstrates that we can ride out some pretty major changes.
On the other hand, Krishna tells Arjuna, some people say that the universe is random and that we are born with this body and die with it. In this case really there is nothing worth getting worked up about in the meantime is there? So either way, the temporary fluctuations of the world around us are not such a big deal.
You will survive
Take a deep breath, and don’t panic. It’s not the end of the world. You will survive. Keep telling yourself that to keep perspective on the situation. You can even sing it while you’re in the shower. There you go - you now have a excuse, as if you needed one. 