Correction: 21st Century Recessions Look More Like Depressions (Unless You Incorporate a Time-Proven Strategy).

Correction: 21st Century Recessions Look More Like Depressions (Unless You Incorporate a Time-Proven Strategy).
 
With the S&P 500 down -17.7% from its February 19, 2025, highs – an official correction and almost a Bear Market – it’s a good idea for all of us to take a few lessons from history to determine our best path forward. Should we sit on our hands and wait, under the assumption that Buy and Hope is the best strategy? Is now the time to learn what an age-appropriate, properly diversified plan looks like? Are we able to do that easily? Is it too complicated? Is there a plan that actually works?
 
Here are the topics we will cover in this blog.
 
The Pandemic Recession of 2020
The Great Recession of 2008
The Dot Com Recession
Buy and Hope?
An Age-Appropriate Properly Diversified Plan
 
And here is more information on each topic.
 
The Pandemic Recession of 2020
Between February 19 and March 23, 2020, the S&P 500 dropped about -38% (in just one month!). That ended up being the shortest recession in history. However, it was because the U.S. printed up $4.2 trillion in cash and handed it out like candy to every adult with a pulse. 
 

While the cash infusion averted a Great Depression, which was the case the world leaders made for printing up this unprecedented amount of capital, it did usher in a downgrade to the United States sovereign credit rating from AAA to AA+ by Fitch Ratings.

Debt has continued to creep up since that time. The most recent reading shows total public debt outstanding of $36.2 trillion (source: Treasury.gov). The total debt and loans in the US are at $102.2 trillion, according to the Federal Reserve Bank of St. Louis. Credit and duration risks are elevated in the United States, which is why many people are suffering paper losses in their fixed income portfolios, where our wealth is supposed to be safe from losses.
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Earning a safe yield without losing principle is tricky in today’s Debt World. That is why we spend one full day educating our attendees on “What’s Safe” at our Financial Freedom Retreat. We also host a Bond and Fixed Income Master Class every year. 
 
The Great Recession of 2008
Between the October highs of 2007 and the March 3, 2009, low, the Dow Jones Industrial Average dropped -55%. It took about six years to crawl back to even. Lehman Brothers investors never recovered. If you wait for the official announcement of the recession, you're closer to the bottom than the top. Headlines are always late.
 

For the millions of Americans that were in trouble with one or more homes that were severely underwater, the recovery took much longer. Over 20 million homes were foreclosed on during the period before and after the Great Recession.

The Dot Com Recession
The Dot Com Recession was one of the most devastating in history. It was also a period when equities were more elevated than any other time.

As you can see in the CAPE Ratio chart above, prior to the current market correction, stock prices were almost as expensive as they were in the Great Depression – second only to the Dot Com era highs.
 
It took the NASDAQ Composite Index 15 years to crawl back to the March 2000 highs of over 5000. Between March 2000 and October 2002, the NASDAQ composite index lost -78%.

Buy and Hope?
Buy & Hope is a plan that worked in the 20th century. However, in the 21st century, when recessions can drop so far so fast and take so long to recover, Buy & Hold wipes out our wealth. Suicide rates rise during troubled times.
 
As we get closer to retirement, we simply cannot afford to lose half of our wealth. When we are young, losing half of our assets could cost us our home, make us borrow on credit cards at high interest rates, plunge us into a serious financial crisis, wipe out our FICO score, and make us vulnerable to financial predators, including high fees and usury interest rates. 
 
An Age-Appropriate Properly Diversified Plan
 
Our age-appropriate properly diversified sample plan was overweighted 20% safe in December 2007. That is how Bill and Nilo Bolden earned gains when most people lost more than half of their wealth. 
 

Keeping a percentage equal to our age safe and overweighting safe in trouble times means that we have less to lose. Our wealth is protected from Wall Street’s volatility. At the same time, our sample pie charts also include hot slices and diversified exposure to size and style funds and companies. Without the support of the Magnificent 7 in 2023 and 2024, our gains would’ve been half of the S&P 500 returns. This cohort of trillion-dollar technology companies doubled in share price in 2023. Having an extra hot slice of technology, or hedges like gold and crypto, can add performance to our portfolio, especially when we are rebalancing and capturing gains 1-3 times a year.
 

​​"Many people, including educated men and women, often get into trouble when they neglect to follow simple and fundamental rules of the type provided [by Natalie]. This is why I recommend them with enthusiasm." 
Professor Gary S. Becker. Dr. Becker won the 1992 Nobel Prize in economics for his theories on human capital

"College students need this information before they get their first credit card. Young adults need it before they buy their first home. Empty nesters can use the information to downsize to a sustainable lifestyle, before they get into trouble." 
Joe Moglia, former Chairman & CEO, TD AMERITRADE.


 
Bottom Line
The sooner we adopt an age-appropriate properly diversified plan that we rebalance 1-3 times a year, the faster our lives transform. While this correction may not be as severe as other 21st-century recessions have been, it’s always a good idea to have a time-proven plan in place, rather than hoping and waiting. If the markets go up, we’ll earn gains and potentially outperform in our hot slices. If the stock slide continues, we will have protected a great deal of our wealth. All of this is as easy as a pie chart – less time, money and stress than Buy & Hope costs.
 

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Join us at our online Spring Financial Freedom Retreat April 25-27, 2025 (online) and our Stock Masterclass (learn the strategies that earned me the ranking of #1 stock picker) on May 3, 2025. If you'd like a life-changing adventure of a lifetime, be our guest at a royal manor house in Cornwall, England, March 12-19, 2027. (With just nine rooms available, this exclusive, private, bucket-list adventure sells out a year in advance!) Call 310-430-2397 or email [email protected] to learn more. The 2025 Restormel Retreat was a magical and royal experience. Click to learn more. 

Your friends and family can get the best price for the April 25-27, 2025 Retreat when they register together. Request testimonials at [email protected]. You can also view some on the flyer page of the retreat. 

Learn how to:

* Invest in hot industries, such as Nvidia, artificial intelligence, and quantum computing,
* Hedge against a weaker dollar,
* Invest and compound your gains,
* Green your retirement plan,
* Easy and efficacious nest egg strategies,
* Get hot and diversified (including in artificial intelligence, quantum computing and crypto),
* Evaluate stocks,
* Avoid capital gains and financial predators,
* Keep an age-appropriate amount safe, and,
* Know what's safe in a Debt World.

You'll even discover how to save thousands annually with smarter big-ticket choices. Yes, it's a complete money makeover. 
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Email [email protected] or call 310-430-2397 to learn more and register. Learn the 15+ things you'll master and read testimonials in the flyer on the home page at NataliePace.com. Register with friends and family to receive the best price. ​

"Ten minutes into the first day I was already much smarter about investing than I ever thought I would be in my life and I knew I was in exactly the right place at this retreat. I am amazed at how EASY and FUN it is to make my money work for me and those I love. I think this kind of information should be compulsory in schools. I wish I'd learned this sooner." CM

If you’d like an unbiased 2nd opinion on your current wealth plan, email [email protected] for pricing and information.

Join us for our Online Spring Financial Freedom Retreat April 25-27, 2025. Email [email protected] or call 310-430-2397 to learn more. Register with friends and family to receive the best price. Click for testimonials, pricing, hours & details.

Join us for our Restormel Royal Immersive Adventure Retreat. March 2027. Email [email protected] to learn more. Click for testimonials, pricing, hours & details. Register now to receive the best price, the best room and eight private, prosperity coaching sessions. There are only 9 rooms available. This retreat includes an all-access pass to all of our online training for a full year for two. Considering the perks, you're receiving a 70% discount to learn the life math that we all should have received in high school, and the room is free! Email [email protected] to learn more. The best rooms at the 2025 retreat were sold out in 2024! Yes, it's a great idea to register and start transforming our lives now!

Natalie Wynne Pace is an Advocate for Sustainability, Financial Literacy & Women's Empowerment. Natalie is the bestselling author of The ABCs of Money (6th edition) and The Power of 8 Billion: It's Up to Us, and is the co-creator of the Earth Gratitude Project. She has been ranked as a No. 1 stock picker, above over 835 A-list pundits, by an independent tracking agency (TipsTraders). Her book The ABCs of Money remained at or near the #1 Investing Basics e-book on Amazon for over 3 years (in its vertical), with over 120,000 downloads and a mean 5-star ranking. The 6th edition of The ABCs of Money and the 2nd edition of Put Your Money Where Your Heart Is (2nd edition) are the most recent releases of these books. Follow her on Instagram. 
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Natalie Pace's easy as a pie chart nest egg strategies earned gains in the last two recessions and have outperformed the bull markets in between. That is why her Investor Educational Retreats, books and private coaching are enthusiastically recommended by Nobel Prize winning economist Gary S. Becker, TD AMERITRADE chairman Joe Moglia, Kay Koplovitz and many Main Street investors who have transformed their lives using her Thrive Budget and investing strategies. Click to view a video testimonial from Nilo Bolden.​​

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Important Disclaimers
Please note: Natalie Pace does not act or operate like a broker. She reports on financial news, and is one of the most trusted sources of financial literacy, education and forensic analysis in the world. Natalie Pace educates and informs individual investors to give investors a competitive edge in their personal decision-making. Any publicly-traded companies, funds or projects mentioned by Natalie Pace are not intended to be buy or sell recommendations.

ALWAYS do your research and consult an experienced, reputable financial professional before buying or selling any security, and consider your long-term goals and strategies. Investors should NOT be all in on any asset class or individual stocks. Your retirement plan should reflect an age-appropriate, diversified wealth plan, which has been designed strategically, with the assistance of financial professionals who are familiar with your goals, risk tolerance, tax needs and more. The "trading" portion of your portfolio should be a very small part of your investment strategy, and the amount of money you invest into individual companies should never be greater than your experience, wisdom, knowledge, patience and diversified strategy.  
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Information has been obtained from sources believed to be reliable. However, NataliePace.com does not warrant its completeness or accuracy. Opinions constitute our judgment as of the date of this publication and are subject to change without notice. This material is not intended as an offer or solicitation for the purchase or sale of any financial instrument.