Step Back From The Cliff: Ft. Wayne Psychologist

By Jeff Neumeyer

August 8, 2011 Updated Aug 8, 2011 at 6:04 PM EDT

FORT WAYNE, Ind. (Indiana's NewsCenter) --- Protecting your sanity in the financial storm.

Fort Wayne psychologist Dr. Stephen Ross says in light of the debt downgrade and plunging stock market, investors might be wise to take a break from the barrage of bad news.

Recent economic data had done nothing to calm any fears about the future direction of the economy.

But Standard and Poors historical downgrade of the United States' credit rating acted Monday like a can of gasoline being heaved into the burning brush pile.

Americans, of course, have been squeamish about the stability of their 401-K plans for the past two and a half years, so when the Dow drops a thousand points in three or four days, some folks are naturally alarmed.

Dr. Ross says this is the time to resist panic.

Dr. Stephen Ross/Psychologist: " What typically happens psychologically is you get afraid, you go straight to your computer, you look at how much you lost on paper. And then you get desperate, and then you make some desperate moves. With what we've known from the past when this has occurred, if you wait it out, over the long haul you'll be fine."

Ross urges folks particularly upset by the economic turmoil to steer clear of news coverage, at least until things settle down again.

Ross says history should be a reassuring thing to most investors.

The stock market tanked during the recent recession, losing about half its value.

Then the market steadily gained more than 5,000 points over a two-year period.

But Ross concedes patience is a virtue, as it will likely take some time for the market to get back on solid ground.

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