But there's no surprise in this news. Everybody knows this. Everybody expects the worst. The numbers will be unsettling. Investors have adjusted for that. They're waiting for Armageddon, selling stocks that have already been beaten down, fearing the absolute worst. They're raising cash. They're in a survivor mode, understandably so.

That doesn't mean every investor should get out of the stock market. In fact, investors who allocate a certain portion of their overall investing portfolio to stocks, will be buying, scooping up stocks that are on sale, ones with great dividends (see Intel Corp. (NASDAQ: INTL) as an example...yielding 4% at this writing).

Remember that stocks are only part of a well diversified portfolio. Real estate, usually in the form of a house, is most often the largest investment anyone makes. That's a great hedge against inflation, a concern most investors have once the new stimulus program is fully implemented. Another asset is life insurance. Another one may be gold. Another one is a money market fund. Another one is bonds.

Also, whenever everyone is going in one direction, it's usually wise to go in another. If the general mindset is to be ultraconservative, it's the investor willing to take a little risk that gets the greatest reward. The stock market rallies can be astounding, sometimes only in one day. If you're not invested, you miss the highest returns.

The fact that stocks are beaten down doesn't mean they shouldn't be bought. They have traditionally performed better than any other asset class over a long period of time. Remember the 90's? Irrational exuberance at its finest. We most likely won't see that type of over valuation in our lifetimes, but it did happen. Now we're suffering the results of that hyperactivity.

Just as the market went to extremes on the upside, it is now going through the opposite. Can things get worse? Absolutely. Losses can mount at every company. The survival mentality can intensify to the point where people only buy necessities and horde cash. That would lead to more companies going out of business, more jobs lost, more catastrophe. It could happen.

Most likely, it won't. First because the stimulus package will make a difference. You can't put almost a trillion dollars into an economy and not expect it to change things. However, if the money has no velocity, that is, it doesn't get spent but is saved, then it won't make a huge change. It would lower interest rates even further as savers keep putting more money in savings, looking for decent returns. They won't find them though because banks won't have borrowers. The banks won't be able to put the money into interest earning assets.

The one thing that will make a difference is human nature. Humans have a natural tendency to better their lives, to improve their living situations, to enjoy life. They want a decent place to live, decent clothes, and decent food. They are insatiable in the drive to improve their lives for themselves and their families. They always have and in every country. It's who we are.

Ultimately, that's what will pull us out of this terrible circumstance, one that we created from excess. Humans do have the ability to learn. With the current popularity of the green movement and living within our means, the economy will change. New industries will form. Old ones will die. Smart ones will evolve. Schopenhauer called it creative destruction. We're witnessing it now. It's not pretty, and it's not comfortable. We'll live through this winter of discontent, no matter how long it lasts and witness a renaissance. We have before.

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