Tulsa CPA Shares Perspective After Brutal Week On Wall Street


Friday, February 28th 2020, 8:11 pm
By: Amy Slanchik


As the Dow Jones wraps up its worst week since the 2008 financial crisis, investors in Oklahoma are wondering what moves they should make – if any – when it comes to their retirements savings.  

CPA Paul Hood has a simple message for those who watched the numbers tank over the past few days, while the number of coronavirus cases went up. 

"My message is just to relax,” Hood said.

He attributes the market dive to emotion. Hood said he doesn't want to tell anyone to buy or sell but does encourage people to stick to their long-term plans.

"Warren Buffett says you should be fearful when other people are greedy and greedy when other people are fearful,” Hood said.

At Trust Company of Oklahoma, advisors are taking calls from nervous investors and encouraging them not to sell.

In a statement, President Jim Arens said in part, "The SARS mortality rate was approximately 10%, while the coronavirus mortality rate is approximately 3%. Historically, based on past epidemics, markets sell off until the number of new infections peak and then the markets recover."

Hood said while the tumble is fueled by the Coronavirus, the fall was going to happen regardless of the illness.

"[In] 2019, it was up almost 40 percent. And there was no correction in ‘19. So, it was gonna happen,” Hood said.

He said at the end of the day, he encourages people to not make financial decisions based on emotion.

Hood said historically, a recovery from something like this takes about a year.

Below is the full statement from the Trust Company of Oklahoma:

“Until the markets get some confidence that this epidemic has been somewhat contained, there will likely continue to be volatility in the markets.

Investors should be mindful that the U.S. economy is doing well relative to the rest of the world.  Our economy is growing 2% per year, unemployment is at all-time lows and earnings are expected to be positive for the year.

Volatile markets like this are unnerving to investors, but we are confident that the markets will stabilize once the number of new infections peak. Investors should remain focused on their long-term goals, stay the course and not sell.

The coronavirus is serious. There have been approximately 83,000 infections and 2,800 deaths.  However, this virus is not the SARS virus. The SARS mortality rate was approximately 10%, while the coronavirus mortality rate is approximately 3%. Historically, based on past epidemics, markets sell off until the number of new infections peak and then the markets recover.”

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