In this episode of Market Foolery, Motley Fool analyst Chris Hill talks about past downturns and how this one compares to them. And about how you can make sense of what's happening in the markets today.

To catch full episodes of all The Motley Fool's free podcasts, check out our podcast center. To get started investing, check out our quick-start guide to investing in stocks. A full transcript follows the video.

This video was recorded on March 12, 2020.

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This video was recorded on March 12, 2020.

Chris Hill: It's Thursday, March 12th. Welcome to MarketFoolery. I'm Chris Hill alone in the studio with a few thoughts to share amid the madness. Six minutes; that's all it took. Six minutes into the trading day this morning another circuit breaker was triggered. And you've probably already seen the business headlines: death of the bull market, the 11-year run is over, the bull market is dead.

And I get it, and I'm the first one to say, "Don't blame the headline writers." And, yes, this is painful, I'm not going to say otherwise, but there's just something about the tone in some of the coverage that I'm seeing that really just strikes me the wrong way. We've been doing Live Q&A sessions every day this week. A couple of them just for members of Motley Fool services, a couple of them on YouTube. And by the way, they're free on YouTube. You can just go to Did one on Tuesday afternoon with Bill Mann and Andy Cross. Doing one Thursday afternoon, this afternoon, with David Gardner.

On Tuesdays, in the middle of the video, Bill Mann turned to me and asked me, "Which felt worse, March 9th, 2009 or March 9th, 2020?" March 9th was Monday, that was the day that Dow Jones fell 2,000 points. I hadn't really thought about that. The reason he asked is, because March 9th, 2009 was the bottom, that was the absolute bottom. And so, I hadn't thought about it, we were live, he hits me with the question, and I said, "I think I felt worse on 2009."

Because at that point we had just been punched in the face for seven straight months. And it was the banking industry and the housing market, and there were unknowns, but they were all about the economy. We were asking questions like, "When is this going to end?" "Is this actually going to be, like, a second Great Depression?" And from an economic standpoint, it was awful; people lost jobs, people lost their homes.

When I see survey data about how a lot of millennials haven't been investing in the stock market, I totally understand why. What the economy was like when you first started to be aware of it and comprehended it, that absolutely has an impact on your psychology when it comes to money. 2008-2009, that was bad economically. What's happening now, what's happening right now, first and foremost, is about public health. And as you know, it's affecting everything. Absolutely everything.

In March, 2009, I was working at The Motley Fool, a company that was struggling at the time. My portfolio was getting whacked, but at least I could find some ways to relax and not think about it for a while. I could go to the movies. I could go to a concert. I could flip on an NBA game. None of those things are options right now. So, we're focused on public health for ourselves and our loved ones; particularly, if you have elderly people in your life, as I do; particularly, if you have children, as I do.

We're focused on our physical health, but please do not forget about your mental health too. We're going to get through this. There's no question, we're going to get through this, but it is going to take a higher level of focus than everyday life, which makes sense because these are not everyday circumstances, these are extraordinary circumstances, but we will get through this.

Again, to paraphrase Morgan Housel, "We will get through this, but holy cow!" So, we've been doing all of these live videos this week. Hundreds of questions coming in from investors of all stripes. People in their 70s and 80s, who are retired and they're trying to figure out what to do? People in their 30s and 40s, who are asking things like, "Should I pull money out of the market?" "What if I want to pay down my mortgage, is that a better use of my money?" "What if I want to make a down payment on a house, because mortgage rates are looking pretty good?"

Got a question yesterday from a kid who's 16 years old; he's just starting out. And so, I guess the first thing I'd say is, now more than ever, think about your time horizon. And if you need money in the next three to five years, it should not be in the market. I don't know how long this is going to last, neither does anybody else. Now, if you don't need that money in the next three to five years, start building the watchlist.

I've got my watchlist. I already know the next five stocks I'm going to buy; I already know what they are. We have trading restrictions here at The Motley Fool, so I'm not going to say what they are, but as soon as I'm cleared to buy them, I will share that information on the show.

If you're building a watchlist, here are two questions to ask of any company that you're thinking about buying, or for that matter, any company that's in your portfolio right now; two questions. First: How good is this business? Not, how much do you like the product; how good is the business? I like to call that an -- well, I'm not going to name a company. I don't want to pick on any company, but just because you like the food at a particular place doesn't mean the business is necessarily good. So, how good is the business? That's the first question.

Second question: How much do I trust the people running this business? Do they have skin in the game? Because skin in the game, maybe it shouldn't matter more when the market is tanking and everything is in the red, but it, kind of, feels like it means more. Certainly, a person running a company where they have a big stake in it. Yeah, I feel like that's something to keep a close watch on. How much do you trust the people who are running that business?

This morning, I actually spent a little bit of time thinking about Thomas Paine. Thomas Paine is one of those names that I think we probably all learned in U.S. history class. He wrote Common Sense. And that's really pretty much all anyone remembers; most anyone remembers about Thomas Paine. Like, if I just asked you, "What do you know about Thomas Paine?" You'd probably be like, "Is that the guy who wrote Common Sense?" "Yes, what else do you know?" "Uh, he wrote Common Sense." So, Common Sense was a pamphlet that was published in early 1776, it was making the case for independence from Britain, and it was incredibly influential.

I don't mean to belittle Thomas Paine. He wrote arguably one of the most influential documents in American history, but he is also the author of a line that you've probably heard before, which is, "These are the times that try men's souls." So, he writes Common Sense, but he also wrote a series of pamphlets that were published throughout the Revolutionary War, called the American Crisis. And it was Payne's way of continuing to make the case for this movement.

The first one that he wrote was written in late December 1776, it was three days before the Battle of Trenton, General George Washington is with his troops and he had Paine's essay, he had this first essay read out loud to the troops, and this is how the essay begins.

"These are the times that try men's souls. The summer soldier and the sunshine patriot will, in this crisis, shrink from the service of their country; but he that stands by it now, deserves the love and thanks of man and woman. Tyranny, like hell, is not easily conquered; yet we have this consolation with us, that the harder the conflict, the more glorious the triumph. What we obtain too cheap, we esteem too lightly: it is dearness only that gives everything its value."

Now, Thomas Paine was writing about freedom from tyranny, and he's writing for soldiers in a time of war, but that basic idea seems to apply to what is happening right now for investors like you and me. Yes, it is absolutely easier and a hell of a lot more fun to invest when everything is going up, but this, right now, this is why people don't invest, because they can't stomach weeks like this. And that's fine; it's not for everyone.

2008-2009, those were trying times too, but those who kept at it, those who stayed in the game, were rewarded for their patience. The bull market is dead, but the bulls are not; the bulls are very much alive. The bulls are being diligent, the bulls are being judicious, and the bulls, right now, are looking for opportunities. And if the history of the stock market has proven anything. It is that over time, over time, the bulls always win.

Out there, it is rough right now, there is no question about that; but out there, also, lies opportunity. And we will not be sunshine patriots on the battleground of investing, because we're bulls, and long live the bulls.

We're going to skip the usual disclaimer, since I didn't mention any individual stocks.

Dan Boyd, behind the glass, has been an absolute rock-star this week. Have a good weekend. Get some rest. Take a mental break. And to quote David Gardner, "Wash your damn hands."