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As I write my last blog for Today's Investor (new opinions are a good thing - it's time to pass the reins over) the global economy is in the midst of what seems to be an economic meltdown. I don't believe that it really is a meltdown; it's only a blip when it's put into perspective.

Before you chastise me and tell me this time is different, let me ask you this - is there not merit in the idea that often, the best way to see the road ahead is to take a look back? Let me expand on that comment. Some of the biggest crises we have had in the past one hundred years have impacted the stock markets. They most certainly have had a short-term negative impact on the markets, but history indicates that the long-term impact is limited. I will give you some examples:

Stock Market Crash of 1929 - markets fell -43.7%, 126 days later they were up 46.0%
Korean War in 1950 - markets fell -12.0%, 126 days later they were up 19.2%
Arab Oil Embargo in 1973 - markets fell -18.5%, 126 days later they were up 7.2%
Stock Market Crash of 1987 - markets fell -34.2%, 126 days later they were up 15.0%
9/11 Terrorist Attacks 2001 - markets fell -14.3%, 126 days later they were up 24.8%

Source - DJIA, Ned Davis Research, CIBC Asset Management (days indicates market days)

Investors react to market fluctuations with emotions rather than applying practical common sense. Remember the old adage, "buy low, sell high" - this is what we are supposed to do as investors but emotions steer us to do exactly the opposite. Emotions need to be taken out of the investment process and I know that is easier said than done. Rational investors stick to a long-term investment strategy. There are some that profess to know how to time the market and try to get in and out of the market at various points - the end result is that this tactic is rarely effective.

Financial Research Corporation conducted an interesting study on the opportunity cost of emotional investing. This study was based on analyzing mutual fund trading patterns in the US over the past decade and they determined there is a significant gap in returns between those who adhere to disciplined portfolio management vs. those who make investment decisions based on emotions. Want to know what that significant gap meant in returns for an equity based mutual fund? 69% - yep, emotional investors cost themselves 69% in returns over a 25 year period.

So while I am very cognisant of the pain investors are going through right now, history tells us that markets will go up again as surely as they came down. To get through this rough time, I suggest you talk to your advisor. If you are in quality investments, your goals have not changed, your time frame for your funds invested remains the same, it is possible that you might not need to make any changes to your portfolio but that is something to discuss and review with your financial advisor. If they have not called you, be proactive and call them - it is your hard earned money after all and you do need to participate in what is going on with it. Ignorance is not an excuse.

Go forth and multiply - dollars and market returns in this case. There are a lot of silver linings in the dark clouds these days.