By Kevin Wood, July 2025
A quick reality check
If April’s slide in share prices felt like being hit by a bus, you weren’t imagining it. From the February peak to the worst intraday level on 7 April, the FTSE‑all‑world index* fell just over 21 per cent. Whether you call that a “correction” or a “bear market” is beside the point. What matters is that this was the seventh full‑blown market panic since March 2000 – roughly one every four years.
Yet despite each drama looking unique and frightening at the time, every single one has ended the same way: markets have recovered and pushed on to fresh highs. Capital invested in a simple global equity tracker at the peak of the dot‑com boom in March 2000 has still multiplied more than six‑fold by the end of May 2025.
The magnificent seven panics – in plain English
Dot‑com collapse & corporate scandals (March 2000 – October 2002)
Internet bubble bursts, 9/11 shocks confidence, Enron and other frauds destroy trust in company accounts.
S&P 500 fell 49 per cent over 929 days – the worst drop since the 1930s at that point.
Global Financial Crisis (October 2007 – March 2009)
Sub‑prime mortgages implode, Lehman Brothers fails, credit markets freeze, deepest post‑war recession.
S&P 500 fell 57 per cent in 517 days – a new record decline.
European Debt Crisis & US AAA downgrade (April – October 2011)
Greece on the brink, fears of euro break‑up, US debt‑ceiling brinkmanship leads to S&P removing America’s AAA rating.
S&P 500 slipped 19 per cent in 157 days; intraday it breached the 20 per cent mark.
“Christmas‑Eve Massacre” (September – December 2018)
Escalating US‑China trade war, Federal Reserve rate rises, threats to sack the Fed chair, and a US government shutdown.
Market dropped 20 per cent in just 95 days, bottoming out on Christmas Eve.
Covid crash (February – March 2020)
Global lockdowns, economic standstill, fears of millions of deaths before vaccines.
Equities fell 34 per cent in an astonishing 33 days; recovered to pre‑pandemic levels within five months once massive support arrived.
Inflation spike and rapid rate rises (January – October 2022)
Post‑pandemic demand meets broken supply chains, CPI hits 9 per cent, Fed delivers fastest rate‑hiking cycle in its history.
S&P 500 slid 25 per cent over 282 days; both shares and bonds suffered.
Tariff Typhoon (February – April 2025)
Sudden global tariff threat, tech giants already in retreat, investors fear a sharp slowdown.
Index fell 19 per cent in 48 days, brushing a 21 per cent intraday loss before bouncing as tariffs were postponed.
Patterns that never change
Every panic feels “different”. The trigger varies – a virus, a war, a political row – but the emotions are identical: fear, doubt and the urge to sell.
Recoveries are explosive. Markets usually bottom when the news still looks dreadful. By the time headlines turn positive, prices have already raced ahead.
Time in the market beats timing the market. Investors who moved to cash during any of these episodes have struggled to catch up. Those who stayed invested – or even added – have been rewarded handsomely.
What this means for you
Short‑term declines are the fee we pay for long‑term growth. Over the past century global equities have compounded at roughly 10 per cent a year, but only by enduring an average drawdown of about one‑third every five years.
Your plan is built for storms. The portfolio and spending strategy we designed together already assumes regular, sharp falls. We don’t need – or try – to predict them; we prepare for them.
The real risk is being out, not in. History shows the bigger danger is missing the first part of the rebound. That single mistake can derail decades of compounding.
Staying the course – together
When the next panic arrives (and there will be a next one), remember this quarter‑century laboratory of market behaviour. Our role is to help you focus on what we can control – costs, diversification, tax efficiency and, above all, your own behaviour.
If recent volatility has left you uneasy, please get in touch. Otherwise, enjoy the summer knowing your long‑term financial plan remains firmly on track.
Footnote: Index data are provided for illustration only and are not a recommendation to buy or sell any security.