The S&P/TSX Index is at multi-month lows after losing about 11% in six weeks. This comes as our neighbours south of the border are witnessing their markets wipe out all their gains for 2014.
It does seem scary. But should investors really be afraid? I continue to think not. I’ve said it before, and I’ll say it again: such a selloff in the markets is rather normal, and might I add, healthy. It’s been a while since we’ve seen the markets erase some gains and many traders expected such movements. Add to that seasonal volatility, ebola scares, slowing growth in Japan, and oil price declines and its only natural for investors to get the jitters.
But while Faber sees gloom and doom, Warren Buffett’s motto is to “be fearful when others are greedy and greedy when others are fearful.” And that’s a concept I agree with strongly. After all, it’s hard to disagree with one of the most legendary investors of our time.