Stock market plunge, what it means for the economy

(AP Photo/Richard Drew)
(AP Photo/Richard Drew)

SPRINGFIELD, Mass. (WWLP) – 2014 is not off to a great start for investors. The Dow Jones Industrial Average plunged more than 326 points Monday, and it’s down more than one thousand points since the beginning of the year.

Stocks dropped more than 2 percent Monday, and experts are predicting even more losses coming.

Cara Lattell of Westfield told 22News, “I actually had someone at work, when it was up, not too long ago, they sold a whole bunch of their stock because it was the highest they’ve seen in years, so they were scared that it was going to go back down. Obviously that was a good decision because it did.”

The struggling stock market has many people concerned, the economy is not showing any signs of significant recovery.

Josh McIntire of Westfield said, “Most of the jobs they’ve added have been a lot of small jobs. They haven’t been high paying jobs, so it hasn’t boosted the economy at all.”

Experts say stocks could continue to decline until it reaches a 10% drop, which would be called a “correction,” but long term investors are advised to be patient.

Financial advisor Mark Teed told 22News when you look at the long-term trend, the stock market has been improving since 2009. So market watchers expect this kind of day to day, up and down movement.

“The fact that we’ve gone about 900 days without even a 10% correction means that we are way overdue. So any kind of bad news at all, people are going to sell first, ask questions later. But those of us that are long-term investors, hold on, don’t let this shake your confidence,” Teed said.

Teed said this could be a good buying opportunity for those in their late 20′s, early 30′s looking for long-term investments.

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