In April, the S&P 500 plummeted 2 days, 6.4% and lost 6.6 trillion in value. Within a week, actions from the Fed and encouraging earnings reports helped stabilize investor sentiment. By June, the market had completely recovered, and by December, record highs were reached.

Investors who remained composed during the crash are now up 20+ percent by the end of the year, whereas panicked investors who fled to cash have missed the wave.

Crashes in the market are scary, yet they turn into buying opportunities for long-term investors who remain disciplined and patient.

At the start of 2025, the Fed started with high interest rates to combat inflation in the past. It turned on its heels as inflation was falling and growth slowed in the middle of the year, lowering the cost of lending.​

Borrowers experienced lower mortgage, car loans, and business credit, and the returns on savings accounts, CDs, and high-yield accounts fell significantly for savers.​

In 2026 borrowers and workers must ensure that they make wise decisions to use lower rates to build, whereas savers must look at locking in better rates before further reduction.

President Trump increased new tariffs on imported goods, frightened companies, and kept shoppers fearing rising prices. Some tariffs were lowered, and the threat of trade calmed down after negotiations.

Tariffs and even tariff headlines influence prices on clothes, electronics, cars, and furniture, and cause businesses and consumers to postpone key spending decisions.

Keep an eye on the tariff news, but do not panic; long-term market panics may provide long-term buying opportunities to long-run, diversified investors.

The AI stocks boomed in early 2025 on the grandiose of massive investment plans, only to crash when the Chinese Deepseek AI was released. It did recover not long after, as companies threw hundreds of billions into AI infrastructure.

AI is transforming jobs and earnings, with technology and information positions producing extremely volatile opportunities in the stock market.

By 2026, the theme of AI is risky and rewarding; invest in it, but not in individual companies.

Gold prices climbed throughout 2025, hitting record highs above $4,308 per ounce. Notably, the stocks and gold moved in unison despite the general movement of the two taking opposite directions.

Shareholders bet against the market as they sought market returns and acquired gold insurance against any market crashes or uncertainties.

Unless you have Gold, you have no hurry to buy at record prices. If you do own it, hold it. It is fulfilling its role of insurance.

In 2025, European stock markets performed better in comparison to the U.S. stock markets, even though America typically prevails. In the case of European stocks, they had lower valuations, good earnings, and reduced tariff exposure.

The global diversification had been used to capture the U.S. and European gains, which performed better as compared to single-country portfolios.

It will be prudent to diversify investments in countries in 2026 to reap the benefits in any country where the gains come and minimize the exposure in the United States.