Self-Hatred and Loathing Can Prepare You For The Next Market Crash

The market is going to crash. You know it. I know it. A young Larry David would’ve known it. The question is what are you going to do when it happens? As a quick reminder, there are three types of market declines. A ‘pullback’ is when the market drops 5% to 10%. A ‘correction’ is when the market drops between 10% and 20%. And a ‘bear market’ is when the market declines more than 20% and you start saving underwear even if it has large holes in it.

From 1945 through 2020, the S&P 500 had 58 pullbacks, 24 corrections and 12 bear markets. Of those bear markets, three of them were of the ‘no-we-can’t-get-Taco-Bell-tonight-it’s-too-expensive’ variety with the market dropping 40% or more. Everyone knows the absolute worst thing you can do in any of these situations is sell your stock holdings because the market always bounces back. It can take awhile though. Pullbacks only last a month or two, corrections four months but the big bad bears can take as long as two or three years for a complete recovery.

On average, corrections occur every two years and bear markets every five years. Since we haven’t had a true bear market in nearly a decade, we’re long overdue. Obviously, the time to mentally prepare yourself for the next big market decline is right now while things are going so well. As someone who grew up with a Jewish mother, I feel uniquely prepared to help you get ready for the inevitable loss of money. Jews always suspect the very worse is about to happen. If you win the lottery, someone will likely kidnap you, chop your body into tiny pieces, throw you in a garbage bag and toss you in the river before you ever get a chance to spend the money. If you’re going on vacation somewhere tropical and warm, it’ll probably rain the entire time. The point is, the end is always near and a decade long bull market is a great way use your own self-loathing to prepare for the eventual losses. Here’s a few specific things you can do to be fully prepared.

Act Like You’re Worth A Lot Less 

When your portfolio is rising, you feel great about yourself. If you’re a middle-aged man, your penis feels at least an inch larger. If you’re an older woman, your breasts feel less saggy. You order out every night. Every time a cute pair of shoes pops up on your Instagram feed, you click “Shop Now.” This raucous behavior needs to stop because the party is about to end. Try forcing your family to eat peanut butter and jelly sandwiches for dinner at least once a week and don’t cut the crusts off the bread for the kids because they need to know that in a bear market those crusts are valuable. Make them eat every last bit of crust and if they start crying tell them that during the great potato famine there were no potatoes. And if they say, “So, we hate potatoes,” then shake your head angrily and say, “There will be no Nintendo Switch tonight unless you eat all your crusts.” And if that doesn’t work, google “Affordable Boarding Schools.”

Subtract 20% From Your Portfolio And Stare At That Number

Since stocks are only paper money, you simply need to get used to the idea of having less money on paper. I do this by leaving little sticky notes all around the house with a number that’s 20% less than I currently have in my portfolio.  Let’s say your portfolio has $100,000. I’d write $80,000 on little sticky notes and put them all over the house. On the fridge. On your bathroom mirror. On your bookmarks. Most importantly, set that number as your screensaver so every time you log onto your computer, you are reminded that this is how much your portfolio, and your life, is worth.

Reduce Sexy Time

Research suggests that people masturbate more during bull markets. In a recession, who has time for personal pleasure? Do yourself a favor and stop taking important time out of your day to pleasure yourself. Working from home is no excuse. When the bear market comes, you’ll need to be sober and emotionally ready for the debilitating sense of loss. Prohibitively taking away your own personal joy before the fall is a good place to start.

Practice Saying “No”

We’ve gotten good at this during the pandemic but there’s always room to improve. When the market collapses, you don’t feel like you can afford to do anything for a few weeks so now is the time to practice saying “no.”

“No, you can’t get a double cheeseburger. One cheeseburger is enough.”

“No, you can’t get the Charmin ultra soft toilet paper. We’re in a bear market.”

“No $24 bottle of buttery Chardonnay. No buttery anything.”

“No we can’t get Paramount+. No one knows what that is.”

“No. No. No.”

One day soon, the market will fall from the sky. But with the right amount of self-hatred and loathing, we’ll all be ready.