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Stocks dive: Keep calm and carry on

What a way to start Thanksgiving week: the supercommittee appears to have failed, Europe is still a mess, global growth estimates are falling and stocks are tanking. Today's selling has pushed the market averages down into the red for the year. (Where's that Santa Claus rally?)

The only good news: Your bond holdings are probably doing very nicely. The 10-year Treasury bond is yielding less than 2 percent. And it should be noted that volume is thin, but still, these numbers will catch your attention.

Here's how the U.S. markets are faring at mid-day:

-- DJIA: 11,470, down 325, or 2.7% (52-week low: 10,604 on 8/9/11)
-- S&P 500: 1185, down 30, or 2.5% (52-week low: 1,101 on 8/9/11)
-- NASDAQ 2507, down 65, or 2.5% (52-week low: 2,316 on 9/23/10)
-- January Crude Oil: $96.30, down $1.37, or 1.3%
-- December Gold: $1,684, down $40.10, or 2.3%

Before you throw in the towel on your portfolio, let's have a moment and invoke what I think is the best mantra for these kinds of days: keep calm and carry on. This was actually a public relations campaign developed by the British government in 1939 during the beginning of WWII, though it was never launched.

There are two great things about this slogan: it reminds us that while investing and markets are important, they certainly can't compare to what previous generations faced in their lives and it is great investment advice. As my colleague Larry Swedroe notes, investors are their own worst enemies, as they sell on fear and buy on greed. "Investors missed the greatest bull market of the past 70 years due to panic selling from the 2008 bear market. Now, it looks like the same panicked selling caused investors to miss out on big gains once again."

Here are three steps to help you break your fear-greed cycle:

1) Don't make any rash decisions amid a big downturn

2) Maintain diversified balanced portfolio

3) Stick to your game plan!

In other words, "Keep calm and carry on!"

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