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We've all seen this coming for a long time. Everyone just stay calm. We're undergoing a market adjustment, they've happened before and this one will be significant.
Anyone who panics and pulls out of the stock market right now is just going to solidfy their losses by moving their money. Instead take a longer term focus and consider that you're buying stocks on sale today.
Anyone who panics and pulls out of the stock market right now is just going to solidfy their losses by moving their money.
Suppose someone pulls their money out today, the Dow goes down to 9,000 and then they buy back in at this point. This person will do wildly better than the one that left his money in the market.
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Instead take a longer term focus and consider that you're buying stocks on sale today.
Or consider that you're buying stocks that are over priced, and will not return to the price you purchased them for a good 5-10 years.
It's interesting....when things go on sale at macy's or walmart, people love it and line up at 4 am (i.e. black friday). People like getting deals in stores.
Yet when stocks go down, people dont have the same reaction at all. Look at past declines, thats when you should be buying.
The media is completely clueless about this, I don't think they'll ever catch on.
Suppose someone pulls their money out today, the Dow goes down to 9,000 and then they buy back in at this point. This person will do wildly better than the one that left his money in the market.
That's surely a possibility, but there's an equal chance the market could zig zag or go much higher. I'd let you know which way it will go, but my crystal ball is too cloudy to tell me. Fact is, no one knows.
I think I'll take it steady as she goes for the next 20 years. This is all "noise" and will be forgotten soon enough just like any other past event.
The current markets P/E ratio is based on the S&P500 earnings growing 14-16% this year,a WILDLY optimistic prognostication,four quarters of 2007 saw the market make about $80,big houses still expecting 2008 to come in at $85-103,without homebuilders and financials (which account for 30-40% of the total earnings) contributing,indeed,many will subtract from overall earnings,I expect an earnings contraction in the 10-15% range,that makes foward P/E almost 20 at current valuations,which wouldn't be too much of a problem if inflation were benign,it isn't,as inflation increases, P/E ratios decrease,in '82 with fed funds @18% and inflation @9% P/E on S&P was 7,so even for us to stay at our current P/E,don't be surprised if the market goes down another 10-15%,don't be ashamed to seek safe harbor from the gale,but if you are daring,short positions via ETF's are an easy way to play it,remember,money you don't lose on the way down is money you've made!
don't be surprised if the market goes down another 10-15%,don't be ashamed to seek safe harbor from the gale,but if you are daring,short positions via ETF's are an easy way to play it,remember,money you don't lose on the way down is money you've made!
Again, it might or might not go down, that's anyones guess.
I'm not smart enought to predict which way things will turn out and neither are those guys on wall st. w/fancy suits who get paid alot of money. (Many of them can't even outperform their own benchmarks...)
Naah, I think I'll take it slow and steady and filter out the "noise".
Seems to me that the stock market goes down every time it looks like Obama has a chance to win the presidency.
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