PANIC - Dow Stocks Hammered

DON'T JUMP!

Bad day on Wall Street:

Stocks logged their biggest drop of the year Thursday as investors worried about two events coming Friday — a German vote on the EU bailout and options expiration.

The Dow Jones Industrial Average shed 376.36, or 3.6 percent, to close at 10,068.01, finishing at its session lows after the selloff accelerated in the final minutes of trading.

All 30 Dow components finished lower, led by Bank of America [BAC 15.30 -1.01 (-6.19%) ], Alcoa [AA 11.07 -0.71 (-6.03%) ] and GE [GE 16.26 -1.00 (-5.79%) ].

The S&P 500 lost 3.9 percent and the Nasdaq fell 4.1%. The CBOE volatility index, widely considered the best gauge of fear in the market, jumped over 25% and was above 44 at the closing bell, its highest level in over a year.

Never fear. These short-term corrections are great buying opportunities. When we look back 20 years from now, these last few "dog with fleas" years will prove to have been the years when we bought stocks at bargain prices.

Don't get emotional about the crowd sentiment or the current headlines. Think long-term and invest like a contrarian.