It’s simple to paraphrase Ben Stein’s latest column on Yahoo Finance. If you have a long-term view, take advantage of short-term traders who panic in a recession. Buy and continue to buy through market downturns, and you’ll make more money in the long term.
The evidence is overwhelming and consistent that if you buy when stocks’ P/E is below its 15-year moving average, you’ll make far more money than you would if you bought at the economic peak, when P/E’s are high. So, unless you’re out of money to buy with during the recession, you buy. You don’t go on margin to buy, and you don’t re-mortgage your home to buy. But if you’re employed and have money to invest, you buy.
When everyone else is panicking, and the media is in a frenzy, there are bound to be deals everywhere.