Financial expert: No need to panic after drastic Dow drop
The Dow on Thursday dropped more than 1,800 points, marking one of the worst lows since March. This comes as COVID-19 cases start to increase again. The slide caused some panic, but what does it really mean in the long run?
Friends University Finance Professor Dr. Jim Long provides insight into what happened Thursday.
"It's a scary time. The economy is doing exactly what we as people are doing," Dr. Long says. "We saw a spike in COVID cases and there was a reaction to the market because it makes us nervous."
He says some are calling what happened with the Dow Thursday, "a correction."
"Since March, we had recovered so much of it and a lot of folks like to see, whenever we have a significant economic downturn like this, they want to see that nice "V" correction where you go straight up, but that's not the real world," Dr. Long says. "You are going to slide back a bit and it's going to be a gradual, gradual thing."
He says emotions often play into the market.
"Since it has a lot to do with hype and buying and speculating and emotions, it's a hard little riddle," Dr. Long says. "I think it has to do a lot of how we feel about things like COVID, but other things going on in our country too."
Besides watching the markets sharp highs and lows, Dr. Long says one thing you can do right now is buy and invest. He says investing in things like oil or banks is a good idea.
"Just know the quarters after these significant downturns, you have historically always seen great improvements," Dr. Long says. "So what I say is, 'everything will be okay. Give it some time.'"