I wrote about this very same concept on 10/6/2014. The concept is this:
The media today is touting a "sell off" in the markets over the US/North Korea verbal jabs. However, the Dow is, currently, down 81.93 points and the S&P 500 is down 4.14 points. That is 0.37% and 0.15%, respectively.
That is NOT a sell off!!!
The issue with this is when the media touts a very small draw down as a sell off and the market participants begin to buy into that fact, then when a real sell off (of 10%+) happens panic begins to set in.
Could this happen? Of course, anything is possible.
But I just want to keep everyone updated on this phenomena. With volalitity being at record lows, small pullbacks might cause some uneasiness. But, remember, 3 to 5% sell offs are common place in normal functioning markets. And 0.37% pullbacks are, literally, nothing!!
Keep your wits about you. Don't buy into the media's over-sensationalizing everything. The North Korea situation could impact the markets, but it hasn't yet. Be ready, but don't panic.