Howard Marks: Can You Strap Yourself In For The Long Term Regardless Of What Happens Tomorrow

During his recent interview on CNBC Howard Marks was asked his thoughts on investor psychology as the market briefly tumbled 1011 points due to coronavirus fears. Marks provided some great insights into the importance of thinking like an investor in periods of uncertainty. Here’s an excerpt from the interview:

Scott Wapner: Let me ask you about investor psychology, in general, with another area where you’ve made your living looking at. You’re down 1011 points a little bit earlier, we’re down 900. You put another day on the back of a day like this. Or a couple of days. How much destruction is in that to the psyche of the American investor? Who by the way may have come into this market in ways that they haven’t in years because of zero percent commissions, free trading, this that and the other thing. Talk to me about that.

Howard Marks: And ETF’s with liquidity at any moment. That’s a really good question Scott. But almost unanswerable. We’re talking here about psychology. We’re talking about popularity and these things are absolutely unpredictable. Some people are going to say the market was down 1000 and it’s due for a bounce tomorrow. Some people are going to say it’s down 1000 and it’s going to keep going.

There’s no way to know these things, and by the way the reason I come on these shows is I want to convince people that these are not the things that matter. What it’s going to do tomorrow isn’t going to matter.

Just before the break Bryn was talking about the fact that she’s confident that being in the stock market for the next 10 years is going to do better than 137 on the 10 year. Something would have to be very very wrong for that not to be true. The key phrase is… For the next 10 years!

The investor, and the viewer, should ask them-self can I strap myself in and stick around for 10 years regardless of what happens tomorrow, over the next month, over the next year, that’s called being an investor, not what I would call a trader.

You can watch the entire interview here: