Looking over old news is often considered to be a waste of time. These days, even stories that are one-week-old can be deemed irrelevant, such is the quantity of news stories that are published these days.
But looking over old articles – and by old, I mean going back months and even years – can actually provide a much-needed reality check for investors focused on the now, and the immediate future.
First, it's worth looking at a relatively 'recent' conflict between Russia and the Ukraine. Sure, it seemed like a big deal at the time, and thousands of people tragically lost their lives. But at the time, the term 'World War 3' was being thrown around frequently.
In fact, according to The Inquisitr, 'experts' suggested that we were just 'minutes away' from World War 3 on 66 separate occasions in the past year and a half.
That conflict barely registers in the newspapers these days and most individuals have well and truly moved on in the time since.
Then of course, there was the US debt ceiling which many feared would throw the world into a deep recession. This was back in the news in March this year, but most investors (in Australia, at very least) forget the fact that we all faced that risk back in 2011 as well.
Despite the fear and panic, that crisis was well and truly averted at the time, and global share markets subsequently rallied in the years that followed.
There are more examples of these overblown newspaper reports than one can count. And what that shows is how reactive human beings can be to bad news as it happens, but how little impact they can have on us in the long-run.
Think of the Greek debt crisis. That was a doozy and featured on the front page of most major newspapers around the world as the situation was unfolding. It's barely mentioned these days.
Think of all the times 'experts' have predicted a recession for the Australian economy. Yet we still haven't actually had one since 1991.
Think of the fear spreading throughout Australia as the S&P/ASX 200 (ASX: XJO) plunged 23% in 2011. Most investors don't even remember that crash, nor do they remember what specifically caused it.
Most recently, Citi's chief economist Willem Buiter estimated a 55% chance of a global recession in the next two years, as highlighted by the Fairfax press.
Who knows, maybe he'll be right (although one does have to question how anyone could land on such a precise estimate for a global recession, considering all the factors at play). But five years from today, I doubt we'll remember that statement, either.
The point I'm trying to make though is that human beings inherently focus on the bad news and then blow it out of proportion. The media simply stoke the fire by releasing negative headline after negative headline – bad news sells, after all.
Global equity markets have been battered and bruised in recent weeks, and investors around the world are terrified about what will come next. I won't even suggest I have any clue what the market will do today, tomorrow, or even next year, but I do know that this turmoil will pass, and investors who hang on for the ride will be rewarded the most over time.
For long-term investors, the recent volatility shouldn't be anything to be too concerned about and should instead consider taking advantage of cheaper share prices. I have personally topped up my portfolio in the last few weeks and still have high-quality companies such as REA Group Limited (ASX: REA) and Carsales.Com Ltd (ASX: CAR) on my radar.
Here's to 'Foolish' long-term investing, and here's to ignoring the noise from the markets.
