People walk past an electronic billboard displaying a stock index intraday chart. (Photographer: Jerome Favre/Bloomberg)
Every now and then the market asks us to take some precautions. The last week—see Warning Shots Fired—was one such. The idea behind taking precautions is that we can be ready for action if it is necessitated. If we don’t prepare for that, then our actions will get rushed when the unexpected actually does happen. When you are unprepared, you will move fast (because the situation demands it) but your actions will not be thought out. Wh...