As investors, it’s easy to feel overwhelmed during a stock market decline. Each time it happens, it feels like this time is different. The reasons might vary, and the situation may seem more dire than ever before, but the truth is, the pattern remains the same. History has shown us that the market goes through temporary declines, no matter how grave the circumstances seem.

Let’s look at some of the major market crises over the past few decades: the Harshad Mehta scam, the Asian Financial Crisis, the bursting of the Tech Bubble coupled with the shock of 9/11, the Global Financial Crisis, and most recently, the COVID-19 pandemic. Each of these events sent shockwaves through the financial markets, leading many to believe that the situation was unprecedented, and that recovery was uncertain. Yet, despite the initial panic and the overwhelming sentiment that this time is different, the market eventually recovered.

In the face of such crises, governments and central banks often intervene—whether by reducing interest rates, implementing fiscal stimulus, or introducing other corrective measures. Companies also adapt to the new realities, finding ways to weather the storm. And then, quietly, almost without notice, the market begins to recover. The upward move doesn’t come with fanfare; it happens gradually, and before anyone realizes, the market not only recovers but often goes on to reach new highs.

This is the recurring script of market declines. Whether it’s a financial scandal, a regional crisis, a global pandemic, or even a financial meltdown that threatens the very existence of the system, the outcome remains consistent. The market declines, it panics, it corrects, and then it recovers.

Enter any reason (fill in the blanks) for the market decline…and you will see this same script play out again and again.

The key takeaway for investors is to understand this pattern and resist the urge to panic. By keeping a long-term perspective and recognizing that these downturns are temporary, you can avoid the emotional pitfalls that lead to poor investment decisions. In the end, the market has a remarkable ability to recover and reward those who stay the course.

The late Charlie Munger said it best – ‘The big money is not in the buying and the selling, but in the waiting.’