Five Investor Lessons From Five Volatile Weeks

I should have known better. Just as the Dow Jones Industrial Average neared the 50,000 milestone in early January, a producer called to interview me about what was pushing stocks higher. Since then, stocks retreated for a few weeks but have now recovered. Separately, other assets that were soaring, like precious metals and crypto, have taken investors on a wild ride.

1. Beware of the Bandwagon. After the Presidential election in 2024, bitcoin crossed the 100,000 mark, as investors believed that Trump would be true to his promise of being the first “crypto president”. His administration was filled with crypto-friendly people, who watered down regulations, prompting all sorts of investors to buy into the craze. [As a note, throughout crypto’s history, I have warned “that any crypto investment will be volatile, so keep the amount invested to under five percent of your total investments.”] Clearly many have made a lot of money on their wagers. By October of 2025, Bitcoin soared above $126,000, but just a few months later, its value has almost been halved.

2. Beware of the NEXT Bandwagon. Some investors who didn’t get their buy orders in for crypto, have been lured into gold and silver, which have enjoyed massive gains over the past year or so. Considering that my career started as a gold, silver and copper options trader on the floor of the Commodities Exchange of New York (think: Trading Places), I can state with certainty: beware of the whippy nature of commodities markets! Like Bitcoin, some wanted a piece of the action, but they soon learned just how much commodities can whip around. On Friday, January 30th, gold plunged nine percent and silver lost a quarter of its value. Again, limiting your exposure to less than five percent of your total investments will not prevent losses, but it will help limit the overall damage.

3. Be Skeptical of Reductive Headlines. Over the past couple of weeks, there have been announcements of layoffs from the likes of Amazon, UPS, Dow, and the Washington Post. On the heels of those layoffs, Challenger Gray and Christmas reported “JOB CUTS SURGE IN JANUARY; HIGHEST JANUARY TOTAL SINCE 2009. LOWEST JANUARY HIRING ON RECORD.” Since covering this dataset over time, I have become a little less confident in its ability to tell a broader story of a labor market collapse.

To gauge where we are, I turn to the experts for a reality check. According to economist Guy Berger, the Challenger report is for “job cut announcements, which are a small and unrepresentative subset of actual layoffs.” In fact, Berger highlights that actual “layoffs are currently low by historical standards, lower than January 2023 and any January during 2010-18, and comparable to January 2019, 2024-2025.”

KPMG Chief Economist Diane Swonk provides much-needed nuance when she looks ahead to the (delayed) January jobs report. “Payroll employment is expected to rise by 65,000 jobs in January, the largest gain since September 2025, but less than half the pace of monthly gains in 2024.” She also notes that the unemployment rate is fairly steady due to a combination of “curbs on immigration and peak baby boomer retirements,” which reduce the number of people actively looking for a job.

I understand the pressure to write a clickable headline, but here’s the boring one that I would like to see: “THE LABOR MARKET IS COOLING, NOT FROZEN”.

4. Avoid Daily Market Check-Ins. Most of us are saving for a long-term goal, like retirement or college, which is likely years or decades in the future. Reviewing market action on a daily basis will not help you achieve those goals, but it might encourage you to act, and that’s rarely going to work out in your favor.

5. Don’t Keep Money You Need in a Volatile Asset. Do you need to make a house down payment, purchase a car or pay a tuition bill within the next 12 months? Did you “forget” to free up that money and now it’s stuck in something that has gone down in value? If so, that money should never have been at risk at all, so admit that you blew it and get whatever you need out and keep it in a safe savings, checking or money market account.