{"id":1961,"date":"2025-04-07T06:21:35","date_gmt":"2025-04-07T06:21:35","guid":{"rendered":"https:\/\/www.innov8fs.co.za\/blog\/?p=1961"},"modified":"2026-03-18T11:46:05","modified_gmt":"2026-03-18T11:46:05","slug":"keep-your-head-if-youre-spooked-by-tariffs-warren-buffett-once-suggested-reading-a-19th-century-poem-when-stocks-fall","status":"publish","type":"post","link":"https:\/\/www.innov8fs.co.za\/blog\/2025\/04\/07\/keep-your-head-if-youre-spooked-by-tariffs-warren-buffett-once-suggested-reading-a-19th-century-poem-when-stocks-fall\/","title":{"rendered":"\u2018Keep your head\u2019 if you\u2019re spooked by tariffs: Warren Buffett once suggested reading a 19th century poem when stocks fall"},"content":{"rendered":"
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Stock prices\u00a0fell sharply on Thursday\u00a0after President Donald Trump the day before\u00a0announced sweeping tariffs\u00a0of 10% on all U.S. trading partners and higher levies on countries with which the U.S. has a trade deficit.<\/p>\n

With Thursday\u2019s decline, the S&P 500 \u2014 a proxy for the broad U.S. stock market \u2014 has now slid more than 11% from its record high in February, putting the index in\u00a0correction territory, defined as a drop of 10% or more from recent highs.<\/p>\n

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Investors and economists\u00a0alike fear that Trump\u2019s tariff policies could ignite a trade war with the nation\u2019s trading partners and push inflation higher, two factors that could push the U.S. toward an economic slowdown. Should a recession become imminent, markets could sell off \u2014 and quickly.<\/p>\n

Over the years, Berkshire Hathaway chairman and investing legend Warren Buffett has recommended staying calm in times of volatility.<\/p>\n

In his\u00a02017 letter to shareholders, Buffett wrote: \u201cThere is simply no telling how far stocks can fall in a short period.\u201d But should a major decline occur, he continued, \u201cheed these lines\u201d from\u00a0Rudyard Kipling\u2019s classic poem \u201cIf,\u201d\u00a0circa 1895.<\/p>\n

\u201cIf you can keep your head when all about you are losing theirs … If you can wait and not be tired by waiting … If you can think \u2014 and not make thoughts your aim … If you can trust yourself when all men doubt you … Yours is the Earth and everything that\u2019s in it.\u201d<\/p>\n<\/div>\n

Why keeping your cool pays off<\/h2>\n
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It\u2019s worth noting that Buffett was writing about major declines in the stock market, such as periods like the 2007 to 2009 bear market during which the S&P 500 lost more than 50% of its value.<\/p>\n

Those are quite a bit rarer than what\u2019s happening now. In fact, corrections in the stock market are pretty standard fare. There have been 21 declines of 10% or more in the S&P 500 since 1980, with an average intra-year drawdown of 14%,\u00a0according to Baird Private Wealth Management.<\/p>\n

Of course, investors often don\u2019t know if things are going to go from bad to worse until they do.<\/p>\n

\u201cNo one can tell you when these will happen,\u201d Buffett wrote in 2017. \u201cThe light can at any time go from green to red without pausing at yellow.\u201d<\/p>\n<\/div>\n

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But whether a decline is modest and short-lived or seemingly long and painful, the message to individual investors is the same: Stick to your long-term plans and continue investing.<\/p>\n

Buffett writes that he views downturns as \u201cextraordinary opportunities.\u201d Why? Because, historically, it\u2019s never been all that long before the market resumes its upward trajectory.<\/p>\n

Since 1928, the average bear market \u2014 defined by a decline of 20% or more from recent highs \u2014 has lasted less than 10 months,\u00a0according to data from Hartford Funds. In the scope of the several decades you likely plan on investing, that\u2019s practically no time at all.<\/p>\n

And even if living through it can be scary, keep your eyes on the prize: your long-term goals. By continuing to consistently invest as the market declines, you effectively buy stocks when they\u2019re selling at a discount. As long as you take a well-diversified approach to investing, you\u2019ll get a better and better deal the further stock prices fall.<\/p>\n

As Kipling says, keep your head, ignore breathless headlines and keep doing your thing. Will the Earth and everything in it be yours? Maybe not \u2014 but you\u2019ll likely do a good job of boosting your long-term wealth.<\/p>\n

The whole attitude recalls another quote of Buffett\u2019s, about taking advantage of bargain-priced investments, this time from his\u00a02009 shareholder letter: \u201cBig opportunities come infrequently. When it\u2019s raining gold, reach for a bucket, not a thimble.\u201d<\/p>\n

Want to earn some extra money on the side?<\/strong>\u00a0Take CNBC\u2019s new online course\u00a0<\/em>How to Start a Side Hustle<\/em>\u00a0to learn tips to get started and strategies for success from top side hustle experts.<\/em><\/p>\n

Plus,\u00a0<\/em>sign up for CNBC Make It\u2019s newsletter<\/em>\u00a0to get tips and tricks for success at work, with money and in life.<\/em><\/p>\n<\/div>\n

Credit: Ryan Ermey<\/h6>\n","protected":false},"excerpt":{"rendered":"

Stock prices\u00a0fell sharply on Thursday\u00a0after President Donald Trump the day before\u00a0announced sweeping tariffs\u00a0of 10% on all U.S. trading partners and higher levies on countries with…<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"class_list":["post-1961","post","type-post","status-publish","format-standard","hentry","category-innov8ions"],"_links":{"self":[{"href":"https:\/\/www.innov8fs.co.za\/blog\/wp-json\/wp\/v2\/posts\/1961","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.innov8fs.co.za\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.innov8fs.co.za\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.innov8fs.co.za\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.innov8fs.co.za\/blog\/wp-json\/wp\/v2\/comments?post=1961"}],"version-history":[{"count":1,"href":"https:\/\/www.innov8fs.co.za\/blog\/wp-json\/wp\/v2\/posts\/1961\/revisions"}],"predecessor-version":[{"id":1963,"href":"https:\/\/www.innov8fs.co.za\/blog\/wp-json\/wp\/v2\/posts\/1961\/revisions\/1963"}],"wp:attachment":[{"href":"https:\/\/www.innov8fs.co.za\/blog\/wp-json\/wp\/v2\/media?parent=1961"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.innov8fs.co.za\/blog\/wp-json\/wp\/v2\/categories?post=1961"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.innov8fs.co.za\/blog\/wp-json\/wp\/v2\/tags?post=1961"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}