Paul Schatz, President of Heritage Capital LLC, says the sticker shock is worse than what this means for your bottom line.
“People are more freaked out now because they see the large numbers,” Schatz told News 8. “I think this is a short-term panic and not anything that’s going to impact the economy for at least the next 6 to 9 months.”
As for why we saw the drop? Schatz says the last 24 months were the least volatile in market history, with a growing national and global economy, wage increases and rock bottom interest rates.
“The market is a little bit scared about interest rates, the market is a little scared about wage growth,” Schatz continued. “Historically this is all very normal. I’m going to put quotes around “healthy and routine” because nobody feels healthy and routine when you live through it.”
Mel Twiest says he’s not overly concerned, but says it certainly doesn’t feel good seeing the numbers.
“It’s not pleasant, but what goes up comes down and nobody complained when it went up in such a spectacular and really ridiculous way,” Twiest said.
Imran Kassam says this is just what the market does.
“Volatility is just part of what happens and I think over the next few months everything with even out and another cycle will begin,” Kassam added.
As for your investments and 401K, Schatz says don’t do anything rash.
“The average 401K investor should do absolutely nothing,” Schatz said. “Don’t compound a problem with a problem and emotionally panic-sell then look back and see the market is back and say ‘what to do now.'”
As for interest rates, they’re expected to rise.
“If you’re going to borrow money for a car or borrow money on your credit card, those interest rates are going to go up and remain that way until at least the other side of the recession,” Schatz continued.
Financial experts say they expect stocks to bounce around volatily for the next two to four weeks before settling down and evening out. Schatz says we could see all-time highs by the second quarter of 2018.