Fear Is Driving the Stock Market. Warren Buffett Has 6 Words for Moments Exactly Like This.

It's been a rough few weeks for the stock market. Surging oil prices and the tech sell-off continue to plague Wall Street, and although the Federal Reserve chose to hold interest rates steady in July, any future rate hikes could potentially add fuel to the fire.

While the market has climbed to new heights over the past year, the cracks may be starting to show. The S&P 500 (SNPINDEX: ^GSPC) is on pace to end its second straight month of declines, and the Nasdaq Composite (NASDAQINDEX: ^IXIC) is dangerously close to correction territory after falling by 9.7% since early June, as of this writing.

Image source: The Motley Fool.

Investors are starting to feel it, too. The Fear and Greed Index measures investor sentiment on a scale of 0 to 100, with lower numbers indicating fearful sentiment and higher numbers indicating greed. In May 2026, the metric peaked at 71. As of this writing, it sits at 37 -- well within the "fear" category.

Nobody can say exactly where the stock market is headed in the coming months. However, investing legend Warren Buffett can offer six encouraging words to help navigate times like these.

It's time to be greedy

In 2008, Warren Buffett published an opinion article in The New York Times, in which he offered what would become one of his most famous pieces of advice to "be greedy when others are fearful."

At the time, the U.S. was deep into the Great Recession, and many investors were losing faith that the market would ever recover. While we're not in recession or even bear market territory just yet, some sectors of the market have been hit hard and could have further to fall.

While market downturns are nerve-wracking, the silver lining is that they allow you to buy quality stocks at deep discounts. The market is essentially on sale during a downturn, and considering how pricey many stocks have become in recent years, that could be a fantastic buying opportunity.

In Buffett's own words: "Bad news is an investor's best friend. It lets you buy a slice of America's future at a marked-down price."

History says the future is bright for the stock market

The key to surviving a bear market or recession is to not just continue investing, but to invest in stocks with long-term growth potential. These companies may still take a beating in the near term if the market plunges, but history shows they are the most likely to recover with enough time.

For example, say you had invested in an S&P 500 ETF in January 2008. The Great Recession officially began three months earlier in October, but the worst was still to come that year.

In the near term, it may have seemed like you'd invested at the worst possible moment -- at the very beginning of one of the most severe economic downturns in history. But if you'd simply stayed invested for the next 10 years, you'd have earned total returns of 126%, more than doubling your money.

^SPX data by YCharts

Right now is a pivotal moment for investors. Many stocks have become overhyped and overvalued in recent years, as investor enthusiasm has led to record-breaking gains. But not all stocks will recover from volatility, and those with shaky foundations are more likely to crash and burn.

It's wise, then, to comb through your portfolio and double-check that every single stock still deserves its place. If you find any that no longer align with your goals, unloading them while prices are still relatively high can be a smart move.

And if you can swing it, investing more heavily in quality stocks can set you up for long-term success. If history proves anything, it's that volatility isn't the real risk investors are facing; it's investing in the wrong places.

Katie Brockman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.