New York Stock Exchange Closed for Ten Days!
An Economic Crisis of Unexpected Proportions
Railroads still rolling
Crazy times erupted in the stock market as banks overextended credit and there was a panic as banks closed due to the panic involved. The over extension of credit was in the form of loans to cover operating expenses and planned expenditures in the railroad industry.
People from all walks of life are affected and the country is thrown into a depression that lasts for years.
The year of this tragedy? 1873. Some people may have guessed that it would be 1929, but that was a whole other crisis brought on by a totally different circumstance.
But what does this tell us? Life and the market is cyclical. some fortunate souls in 1873 saw opportunity in the crisis and did not panic, just like people are doing currently. I just read a story in a financial magazine the other day of a twenty-something who hadn’t been involved in investing whatsoever, but saw the current downturn as the perfect time to take his savings and find undervalued companies and invest. His money has more than doubled in the past year. Yes, that’s an unusual case, and certainly isn’t the norm, but it does go to show that no matter what the times look like and no matter who you are, you can make money.
In times of great tragedy invest in companies that are giogn to profit from the downturn or the events of the day. Construction after the San Francisco Earthquake or the Chicago Fire was rampant and those in that business made fortunes, while others around them cried the blues. (on that same note, blues musicians did alright, too)
Know that the New York Stock Exchange is not closed for an extended period today, but also know that good and bad times come and go like the tide. When asked for a phrase to help in every circumstance, “This too shall pass” is one to think on.
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I like your message. Life is indeed cyclical. Your advice that “this too shall pass” also applies to most who find themselves unexpectedly in the job market at this time.