ואל תתיאש מן הפרעניות (אבות א:ז)

Rashi explains how in a few words the Tanna succinctly conveyed two vital messages. The basic explanation understands the above axiom as a continuation of the first two ideas that this Tanna mentioned: "Stay away from bad neighbors and don't associate with wicked people." Even if success is smiling upon immoral people, and even if it continues year after year, know that it won't last forever. Do not despair of retribution since sooner or later a day of reckoning will come.

The Chafetz Chaim related (Netzach HaTorah chap. 3) that in Ayshashok (a small town near Radin) a shockingly cruel offense was committed. The butcher's son was abducted into the army and his father unsuccessfully tried everything possible to release his son from the long years of service that awaited him. Finally, he was told that if he would bring another boy as a replacement then his son would be freed for a price. The butcher went to the local Beis Medrash, snatched a boy who was learning, tied him up and brought him as a replacement for his son!
The entire town was outraged by the cruelty, but time and other suffering took their toll and the story was forgotten. That is, everyone forgot except the Chafetz Chaim. He waited to see what would transpire, and thirty years later he was given the answer. The butcher sent his son to buy cows and he was stung by an insect infected by a virulent disease. He called for help, but due to the contagious disease no one would get near him. Even after he died the Chevra Kadisha refused to deal with his body and the father himself had to take care of the burial. Everyone's compassion was aroused for the bereft father. Only the Chafetz Chaim remembered what had happened and thus knew that the butcher himself was to blame. He intended to save his child and he ended up burying his son with his own two hands.

Just because everything seems rosy, doesn't mean that it will always continue that way. Hashem is exceedingly kind and He waits for a person to repent from his errant ways. He might wait a week, a month, a year, or even a few decades, and one who is living a wayward life might presume that his bed of roses is indicative of God's approval of his behavior. This is not the case, and thus every person must make a personal reckoning, lest he G-d forbid encounter a day of reckoning.
Rashi writes that the Tanna is expressing yet another idea. One should not despair from any retribution that has been meted out to him. Even if the situation looks bleak to the point that there is no way for him to make it out alive, he should never despair.

The prophet Yeshaya was sent to tell King Chizkiyahu that he was about to die since he did not marry. Chizkiyahu requested to marry Yeshaya's daughter but he was told that it was too late since the decree was already sealed. He responded, "Yeshaya, leave and take your prophecy along with you! I have a family tradition that even if there is a sharp sword at one's neck he should not refrain from praying." Yeshaya left and Chizkiyahu turned his head to the wall and prayed from the depths of his heart, and was immediately answered. Yeshaya was sent back in to tell Chizkiyahu that his prayers had been accepted and he would live for another fifteen years!

There was no foreseeable way for Chizkiyahu to extract himself from his predicament. Nevertheless, he did not despair. No matter how depressing a situation one finds himself in, he should never ever give up. Hashem is omnipotent and Hashem is exceedingly kind, and this supreme combination is the recipe for salvation in the most unbelievable ways. Do not "throw in the towel," rather, "Throw upon Hashem your burden - and He will sustain you!" (Tehillim 55:23)