Warren Buffett Disagrees With 32% of Americans About Investing in a Downturn

May 16, 2023
By Heather Taylor

Do you invest your money during an economic downturn? In GOBankingRates’ Top Money Experts 2023 survey polling 1,045 Americans, 32% of respondents said they don’t invest.

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How does this break down across various age ranges? Of those ages 55 to 64, 44% said they do not invest in a downturn. Neither do 39% of respondents ages 45 to 54. And 37% of women said they wouldn’t invest in an economic downturn — a significantly higher percentage than men (26%).

In a recession, legendary investor and businessman Warren Buffett has a different investing approach. Here’s why he disagrees with 32% of Americans.

How Does Warren Buffett Invest In a Downturn?

In October 2008, The New York Times published an op-ed written by Buffett titled “Buy American. I Am.” As the world was experiencing a global financial crisis, Buffett said he was buying American stocks through his personal account.

“A simple rule dictates my buying: Be fearful when others are greedy, and be greedy when others are fearful,” Buffett wrote.

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Why Should You Buy Stocks and Invest When There’s Fear?

While 31% of Americans surveyed by GOBankingRates would not invest in a shaky economic climate, Buffett argued there is savvy found in investing during times when fear is widespread. At the time, Buffett said he couldn’t predict short-term stock market movements, but it was likely the market would move higher before the economy or sentiment turned up.

Stock market news, Buffett said, will be good over the long term. But when it’s not? This is the time to buy rather than wait until there’s a more optimistic outlook or worse, sell stocks after reading or hearing about upsetting headlines.

“Bad news is an investor’s best friend,” Buffett wrote. “It lets you buy a slice of America’s future at a marked-down price.”