Decoding Scary Stock Market News and Emergency Fund Strategies
Contextualizing clickbait financial news headlines and leveling-up your emergency fund strategy.
In My Humble Opinion
You must know how to contextualize headlines in financial news.
Fun disclaimer time: Because we’re talking about investing! I’m going to break down some information about investing and the stock market, but be advised that this is purely educational and isn’t investing advice.
“Should you pull your money out of the stock market right now?”
“Stock market plunges amid concerns about future recession”
“Here's what's 'dangerous' about the latest stock market plunge”
A pull quote from one of these articles:
“The Dow Jones Industrial Average plunged 1,120 points on Thursday, or 3.3%. The S&P 500 tanked 3.7%. As for the Nasdaq Composite, it tanked 5.2% for its worst day since 2020.”
Okay, here’s the thing. The clickbait, fear mongering stock market news headlines are usually accurate, to an extent. It’s just a frustrating framing to get those clicks, which can ultimately instill fear in the reader. This can be particularly nerve wracking for newbie investors or those who have never experienced an extended downturn in the stock market (also referred to as a Bear market).
It’s important you learn how to decode headlines and the histrionic framing in financial news. You want to protect against any knee-jerk reactions you might feel to make rash decisions in times of stock market uncertainty or panic.
A personal favorite: “The Biggest Point Decline in History.” You might be thinking we saw those headlines in 2020 – and we did. But we also had those headlines in 2018.
Let’s break that down.