"Events like this help us determine what our real risk tolerance is," says Roper.

If your portfolio is "60 percent stocks, there's no reason not to go to 50 percent, if that's the way you feel," says Bogle. "But there is no reason to get out entirely."

If you're invested for the long term, "then you don't start pulling your money around in response to short-term events in the market place," says Roper.

Some consumer advocates have another concern: adequate oversight of (and transparency in) the securities industry.

"A lot of the problems we see are the same problems we saw in Enron or Worldcom," says Roper. "Credit-rating agencies that have missed the boat; investment banks that don't appear to have done due diligence of the securities we're buying; bad investments showing up in pension plans, money market funds, places they don't belong."

The concern is that that "will snowball," she says.

So how do investors trust and keep investing?

"That's a legitimate question, and there is no easy answer," says Roper. "You make sure you don't have money in the market that you need for the short term. The money you do have in the market is diversified. And you hope for the best. Over the years, that has usually been a winning strategy."

Switching picks?
When the market starts to swing, investors hear more about "defensive" stocks. These are the companies that make products that are supposedly "bulletproof" -- items consumers will need in good times and bad.

Where it gets dicey: everyone's "needs" are different. Current events and market forces can play cause and effect in ways you might not be able to predict. You could peg one company's stock as a good defensive pick, but if it gets hit with lawsuits over its product and consumers switch brands, suddenly your safe bet isn't so safe.

Instead, a lot of market watchers are recommending solid long-term planning that will carry an investor through good times and bad.

Definitions

• Large cap -- A company with a market capitalization value of more than $10 billion. • Small cap -- stock with a market capitalization between $300 million and $2 billion. • Sector -- A group of companies in the same line of business, for example technology, telecommunications or pharmaceutical. See the Guide's Glossary for a further explanation of these terms.

"I think there's an argument for older folks to focus on dividend-paying stocks, but the interest is in the dividend, not defensive stocks," says Bogle. "I don't believe in trying to shift sectors."

Financial advisers tweak portfolios in response to the economy with an eye toward long-term growth.

"It's time to have less in small caps," says Kathleen Miller, CFP, president of Miller Advisors Inc. in Kirkland, Wash. Smaller companies "don't have the cash reserves large caps do, nor do they have the market share," she says.

But while she may advise clients to carry less, it's important "to still have some in that category," Miller says.

If you've got a long-term plan, one of the most important things you can do is tune out the hype and panic about what the market is and isn't doing, says Miller.

One big way investors cheat themselves: trying to second-guess the market. "Investors sabotage themselves," says Miller. They read or watch the news, decide to get out when things are bad (sell low), or come back in when things are good (buy high). The smart money plans long term and leaves that money alone, she says.

That means tuning out the "r" word, too, says Swedroe.

"By the time you know you're in a recession, it's too late to sell and react," he says. "Ignore the noise around you."