How to Survive Market Mayhem

AMONG my missions is to advise smart readers against doing dumb things out of haste or panic.

- JEFFREY R. KOSNETT

Over the past two years, that wasn't a problem. The financial markets were uncommonly calm, and the dreaded recession was a mirage, so you could scarcely go wrong with sound dividend- and interest-paying assets. Stocks, including high-yield categories such as energy infrastructure, grew without interruption. Fixed income was a breeze, with 4% to 5% yields on cash and short-term equivalents, or 6% to 8% from high-yield bonds, floating-rate bank loans, and newcomers such as exchange-traded funds investing in collateralized loan obligations. Even shares of long-suffering dividend king AT&T posted a two-year 53% total return.