A “Voting Machine” Week in the Markets

This is a version of an email we sent to clients on April 6th, 2025

"In the short run, the stock market is a voting machine, but in the long run, it's a weighing machine," Warren Buffett once observed—and, in my opinion, this perfectly captures what we saw this week and what we're experiencing right now.

My first direct experience with extreme volatility was on October 19, 1987, when, as a young stockbroker in Chicago, I witnessed the market drop 22.6% in a single day. Investors were "voting" on fears of higher interest rates, rising inflation, soaring oil prices, and uncertainty surrounding new tax laws. Many feared this marked the end for American businesses.

If I were to list every week since 1987 when the market moved by 10% or more, you'd see those weeks are quite rare—but they do happen, and they’re unforgettable.

However, when the "weighing machine" eventually evaluated the fundamentals of companies like Coca-Cola, Microsoft, Cisco, and Procter & Gamble, it laid the foundation for one of history's greatest bull markets. From 1990 to 2000, the market soared over 300%. Notice, though, that this recovery didn't happen overnight—nor within weeks or even months after that dramatic downturn.

Recent market swings reflect that same “voting machine” behavior. While unsettling, history shows markets return to fundamentals—like productivity gains from AI—which support earnings growth and eventual recovery.

I know weeks like this can cause anxiety. Your portfolio should be built with that in mind—structured around a clear plan, thoughtful diversification, and long-term discipline.

We follow a bucket strategy—dividing assets into Now, Soon, and Later. Most of this week’s impact has been in the Later bucket, which is designed for long-term growth, not short-term needs.

This week was jarring enough to remind you: stay steady, stay invested.

DISCLOSURE - All written content on this article is for information purposes only. We utilized ChatGPT and other sources for this article. Opinions expressed herein are solely those of Core Wealth Consultants. Material presented is believed to be from reliable sources, however, we make no representations as to its accuracy or completeness. Core Wealth Consultants, LLC a Registered Investment Advisor in the States of Florida, Indiana and Michigan. You should always consult an attorney or tax professional regarding your specific legal or tax situation. Diversification and asset allocation does not assure or guarantee better performance and cannot eliminate the risk of investment loss.