Karl Eggerss was interviewed by Sharon Ko of CBS discussing the current recession and how to manage a portfolio through it.
Sharon Ko: The Coronavirus pandemic is doing a number on the economy. Many industries are taking a hit and the U.S. is facing a historic surge and unemployment.
Karl Eggerss: I do think we’re already in a recession. I think we weren’t prior to this, but when you literally cut off demand and nobody’s purchasing anything, it doesn’t take long for you to go into a recession. It will get worse for a while. Obviously, a lot of this depends on the fiscal package that the government’s putting together.
Sharon Ko: If you’re invested in stocks, your gut reaction may be to cut and run, but financial advisor Karl Eggerss says do not make sweeping changes.
Karl Eggerss: That is the natural human reaction. The time to do that unfortunately it was a month ago when the markets were at an all time high and so right now what you have to do is, if you’re not a forced seller, meaning you don’t have to sell, usually you get big moves to the upside and that’s the time when cooler heads prevail where you can lighten up if you want to.
Sharon Ko: He adds, this also depends on your age.
Karl Eggerss: If you’re younger, you should be taking advantage of these dips. If you’re older and you’re trying to protect principle, yes, you may need to reevaluate your plan, but making wholesale changes is never a good idea.
Sharon Ko: With that advice in mind, it’ll be an uphill battle for the U.S. economy to rebound. Just like this week, expect volatility in the market. So for most people, Eggerss says, doing nothing may just be the best strategy.