How To Survive Next Market Crash?

A Wall Street guru & riverboat gambler surprisingly tells us rubes “How to Survive the Next Market Crash” by riding it out with long-term bet on stocks, echoing Henry Potter’s crisis reminder to “keep your head.”

Remember Mr. Potter’s offer of a job to George Bailey on the day the Great Depression ‘s run on banks started? “You and I were the only ones that kept our heads,” Potter told George too modestly. “You saved the Building & Loan, I saved the rest.” Replied George: “Yes, well, most people say you stole all the rest.” Maybe it was a matter of patience and discipline by George and Henry as the markets abandoned theirs? Fast forward to the roiled stock market of today. Fund manager Mark Spitznagel, whom the WSJ says repeatedly “earned an astounding fortune … as much as 4,000 times his initial investments … when stocks cratered in 2008 and 2020, now says his own unique computer-based, mathematically-driven timing strategies at his Universa “cannot be replicated.” Even by experienced pros who have tried but failed. His advice as to the “next best thing for individual investors is what Warren Buffett would recommend: JUST BUY AND HOLD STOCKS FOR THE LONG RUN.”

Spitznagel’s logic is as boring as his risky tactics are gut wrenching. A “pessimist,” he doesn’t think the Fed is going to keep raising interest rates for long so that inflation “will stick around”. If so, “bonds are no place to hide.” So, “a long-term bet on stocks, even if a crash lies in the near future, is the way to maximize wealth. Individual investors who can keep their nerve … have the best chance of navigating future financial storms.” Dunno. What would George & Henry say?

Davd Soul