The S&P 500 is experiencing a rapid decline, falling nearly 11% in just two days. While this downturn may seem unexpected, history shows that corrections are common and only about 30% of them turn into bear markets. Since 1940, there have been 46 double-digit corrections, with most not leading to full-blown bear markets.
In the past 85 years, only half of the 14 bear markets reached losses of more than 30%. Three of these crashes were even worse, surpassing a 40% decline. However, it’s essential to remember that this is an unprecedented environment due to ongoing trade tensions.
The current market situation is like being in the eye of a storm, with no clear playbook for navigating it. The impact on margins, profitability, and business confidence could be significant if the tariffs remain in effect beyond two months. However, concessions and negotiations might mitigate the damage.
Despite the uncertainty, panicking will not help investment decisions during chaotic markets. It’s essential to have an investment plan in place to navigate such situations. I’ll share my personal strategy in a future article.
Source: https://awealthofcommonsense.com/2025/04/how-bad-could-this-get