The stock market is down, but you don't need to be

The stock market doesn't reflect the whole of the economy and it doesn't always hit everyone's savings, especially many low income Americans. But spills in the stock market do splash a lot of people. Three out of every five American families own shares either directly or indirectly through retirement plans. So what are some ways these families could be navigating this moment? Dan Villalon is an investment researcher and advisor.

It's a crisis. We can't afford to panic.

And I'm Darren Woods. Today on the show, how to think through a stock market slump. We brush away the cobwebs of fear and confusion and we bring some long held facts to the surface as the Trump administration lurches from tariffs on to tariffs off, firings ahoy to firings halted. Uncertainty is very high.

Uncertainty is stifling for business investment and it's contributing to the recent fall in the stock market. Now we'll go through a full assessment of the current business climate in other shows, but today we want to pull the lens back and look at the big picture for the stock market.

So when the market is 10% down like it has been this week, that's pretty ordinary. It's the situation almost a third of the time.

A few disclaimers here. These analyses are based on the past. The past doesn't guarantee the future. And of course, market crashes with slow recoveries do occur and are painful. And that's why a lot of Dan's advice is about long term investing, like people saving for retirement far in the future.

he played, but he won more of the games, even more of the sets, and by the time he gets to the matches, world champion.

In fact, there's evidence that people who check their stock portfolios more are likely to get worse performances over time than those who check it, say once a year. And that's because the vicissitudes of a stormy trading month turns people more conservative with their investing and they tend to become more likely to invest in things with lower risk but also lower rewards.

Myopic loss aversion.

Well, hopefully you can be long sighted in your investing though, Wayland.

Ignorance is bliss.

And one more thing, Waylon. We've talked a lot about the US stock market, but Dan doesn't subscribe to the idea of so called American exceptionalism. You know, the idea that the way that the US is set up, it means that it's just destined to do better economically than the rest of the world. So to learn more about diversification, we have a whole episode on that and we'll link to it in the show notes.