Yesterday was a bad day in the market. The Dow was down more than 800 points (800 points!), and the S&P was down almost 100 points (100 points!). Surely, this is the beginning of the end.

Now that the third quarter of 2018 is over, we can look back and gain some perspective on what happened. It was a good three months, for the economy and for the markets—at least here in the U.S. Abroad, the news was much more mixed, particularly for emerging markets. Let’s take a look at some of the big ideas that drove the quarter.

The third quarter looks like another good one, at least here in the U.S. Despite ongoing turmoil—both political (with the Kavanaugh confirmation battle) and economic (with the rising trade conflict and tariffs)—markets rose steadily, reaching new highs. Markets abroad were not as positive, with emerging markets down and developed markets generally flat. On the whole, however, investors should be happy. Given the very real risks we faced at the start of the quarter, things could have been much worse. But will we be as lucky in the fourth quarter?

With politics heating up again—and the news from Washington driving scary headlines—I am getting more questions about what that turmoil could mean for the market. Will politics derail it? Will confidence be shaken? Should we be worried?

It was September 29, 2008, when the Dow Jones Industrial Average suffered what is now its second-largest point decline ever: it dropped 777.68 points during the day, after Congress’s rejection of the bank bailout bill. (Nearly 10 years later—on February 5, 2018—it closed down 1,175.21 points.) As bad as these declines were, however, they don't win the prize for the worst day ever in percentage terms. That would be October 19, 1987 (i.e., Black Monday), when the Dow lost 22.6 percent of its value. If we translate that into 2008 terms, the equivalent loss would be more than 2,500 points—or more than three times worse than the 2008 decline.

Today, the meeting of the Federal Open Market Committee (the FOMC or Fed) starts. It will conclude tomorrow with an announcement about interest rates, followed by a press conference. Markets expect the Fed to raise rates by one-quarter of a percentage point. This rise is fully priced into the market, which also expects an increase in December. So far, so good. These increases reflect continued economic growth and the rise in inflation to a more normal level, closer to Fed targets. In fact, the Fed raising rates is a sign of success, and failure to raise rates would cause much more concern than the expected increase.

I should go away more often. While I was on the road, the market hit new highs and looks set to go even higher. This move is kind of a surprise, given the extensive discussion of the trade war, the political turmoil in Washington, the worries about the emerging markets, and on and on. What’s happening, and is it likely to last?

I am sitting in an airport writing this after a speaking trip—and running behind schedule—so this will be a short post. First, thanks to everyone who wrote in to congratulate me on my book, Crash-Test Investing. It is much appreciated. Second, thanks even more to those of you who bought the book—especially Mom and Dad! It is a great start to the publishing adventure.

Brad here. I don’t normally write too much about stock market inside baseball, but something is about to happen that will undoubtedly get a lot of press—and raise a lot of questions. Specifically, the companies that operate the S&P 500 are changing how they classify companies within the index. While these changes won’t actually alter anything about the index as a whole, or the companies within it, they could affect your investments. Because of that, I asked Brian McCormick from our Investment Research department to take a deep dive on what these changes are and what they might mean to you. Take it away, Brian!

You know the old saying: hindsight is 20/20. Apparently, foresight is as well because I have recently seen several prominent economists and investors calling for a recession in 2020. Repent, the end is near—but not all that near.