May was a hell of a month. And mostly all bad.  Indeed it was the worst May since 1940 for the Dow Jones Industrial Average.

Major domestic stock averages covering large cap stocks were down around 8%, wiping out the gains of January through April, and making the year slightly negative for those indexes. International averages were worse. But small and mid cap stock indexes, although down in May, are still positive for the year.

Volatility was extreme—with ups and downs reminiscent of an “E” ride at Disneyland.  The Dow posted triple digit losses or gains in 14 of 20 trading sessions in May.

And on May 6^th the computers that drive the U.S. stock exchanges blew up, sending the Dow Jones Industrial Average down 1,000 points, and then up 1,000 points, all in the space of less than an hour.  Exchanges and the Securities and Exchange Commission still are not sure what caused the problem—or how to fix it.

The so called “Flash Crash” unsettled investors.  And then fears about Greek sovereign debt problems spreading to the other PIIGS (Portugal, Italy, Ireland, and Spain), oil spilling out into the Gulf Coast with no way of stopping it yet discovered, North and South Korea stepping up their military stances over the sinking of a South Korean naval vessel, and elections showing a very unhappy and unsettled electorate in the United States, simply overwhelmed the improvement in economic numbers announced during the month.

Fear triumphed over fundamentals.

All of this raises questions about where things go from here—and how to invest your money so as to preserve and grow your net worth so that you can have the life you want to live.

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