Dear traders and investors; what bloodshed have we witnessed courtesy of the stock market! Over 8 TRILLION DOLLARS in wealth have evaporated after Thursday’s stock market close - down 39% from its peak. Ouch!!!

Aren’t stocks supposed to be the backbone of all retirement portfolios? Only if you believe the giant brokerage firms that recommend them to us or the PhD Finance professors that pitch’em to our sons and daughters in our universities - or the millions of poor souls that hold them in their investment accounts.

As I witness the Dow shatter through 10,000 and 9,000 (levels of important psychological significance) in less than a week, I’m disgusted on how far down our throats stocks have been jammed. Hopefully, this entire experience won’t be in vain. After this catastrophe, whoever doesn’t realize that traditional investments (like stocks, bonds, and mutual funds) are extremely dangerous, is just a plain masochist.

People; wake up! Don’t you realize that buying and holding stocks don’t offer you any protection to the downside? I’m just bewildered by how people insist on buying these ticking time bombs as they plunge into oblivion; trying to catch the bottom. It’s not about correctly guessing where the bottom is located. It is about being exposed ALL THE TIME while you’re in this treacherous equities market.

At the end of the day, the stock market returns around 10% a year based on historical records (probably less after this year’s drop) - but your downside risk by buying and holding is huge. How many bottles of Pepto-Bismol are you willing to drink to make 10%?

Here’s the million dollar lesson: there are other ways; ways that don’t involve stocks or any other economically sensitive asset class. There are some alternative investment products that can basically eliminate traditional market risk from the equation.

Want to learn more about ways to weather the stock market storm perfectly well?

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Americans’ love affair with stocks has caused the delay in many retirements (perpetually in some cases).

This historical credit crisis and real estate bubble blow-up has impacted 401(k) balances across the nation - as well as IRA accounts and non-retirement stock portfolios. Even diversified bond portfolios have gotten whacked, as corporate debt across traditionally “solid” (yeah right!) sectors, such as financial services and insurance, have suffered devastating blows (due to blatant gambling with real estate).

We’ve been warning people against this for years, but unfortunately, the stock-and-bond-centered traditional views of retirement and financial planning are too ingrained in the minds of many investors. It takes a lot of unbrainwashing to bring people out of that spell.

But don’t get me wrong here. I’m not rubbing it in. I feel a lot of sorrow for what our country is going through right now (and it can get A LOT worse). I just want people to throw the traditional investment pyramid in the garbage and open their minds just a little bit. Don’t wait for your stocks to drop to the level of Lehman Brothers (i.e., zero) to take action.

There are other ways to add diversification and safety to your investment portfolio, without lowering your return to that of bank savings accounts. Even though, I’m a fan of day trading (but not with stocks), that should only be a small part of your financial pyramid; assuming you learn to day trade correctly (sign up for our free training and start learning). Most of your pyramid should be composed of investments that provide an attractive return, but with little market risk; investments that your overdressed broker at Merrill doesn’t know about.

During critical times like these, retreating in a fetal position to a dark corner of your closet while sucking your thumb and crying for your momma is not the best solution by far. You need to be proactive and take action early - and don’t wait for any politicians to rescue you (they’re only interested in saving the fat, corporate pigs that caused this mess in the first place).

So what do you do then?

Sign up for our next day trading webinar by clicking here. Believe me; we’re not only going to talk about day trading.

If you want to read the entire article about the heavy toll stock losses are taking on retirement savings, click here.