During the Great Depression, the stock market dropped to about 55 from its peak price of 375. That’s a little more than an 85 percent collapse. I doubt we’ll see things deteriorate that far, but they could according to investing expert, Phil Town. Japan has been in a severe recession for years and its stock market has dropped 85 percent. An 85 percent drop from 14,500 would put the Dow at 2,175.
All this is horribly depressing, and Phil Town knows this. But remember, if you’re a stockpiler of stocks, none of it will matter to your personal investments. You can get off the Dow Jones hamster wheel. If the market goes up from here, we’re going to make money on the stocks we stockpile, because their prices will rise to their value in a rising market. And if the market goes down, we’re going to be even happier, because we’ll have lots of opportunities to load up on more great businesses at really great prices, which will make us even richer when the market does go up. This is somewhat counterintuitive but really can work well.
Tags: investor, payback time, Phil Town, phil town investing
