No, GPMike.

 

I could not agree with your assessment more. I think it is going to be a rough year. I don't know what your time horizon is but for me this is a buying opportunity. I have cash on the sidelines now just waiting to see how the year shakes out. I am looking at 15 years(hopefully) so I need a couple of down turns to buy in cheaply.

Everyones situation is different. Do what you feel comfortable with and most of the time you will be correct. I have a good rule, when you put your head on the pillow at night feel okay about were your money is.

If you change your investments to a more conservative aproach for the year you aren't losing that much in terms of return and as you see things improve change it back to be more agresive.

Good luck

mlc

 

mlc,

You are condoning nothing more than market timing. Good luck with that. I dollar cost average in the ups and downs and I'm consistent. If the market has an inflation adjusted average of 7% over the next 25 years, I'll have a ton of money saved up. That helps me sleep at night. Second guessing the market is the perfect recipe for subpar returns.

 

QUIKAG,

I am not trying to "catch the falling knife".I am putting money to work now or dollar cost averaging. But I am holding some back in cash to see how the market acts the rest of the year. Being conservative for one year that you do not feel comfortable with what you are seeing I don't think is unrealistic.

As for the OP they said that most of there investment is in a company plan. That is a totally different situation from what we are discussing. For them to change there portfolio to a more conservative balance for one year will not affect them that much as they are also continuing to save through out the year.

mlc

 

Well, just revisiting this thread and a thought occured to me the other day. I seem to remember the market being a little shaky regardless of the situation before the presidential elections. Usually a little surge afterward. You here people on the stock shows talk about how the market will do better if its a republican because this, or better if it is a democrat because of that.

But I heard another guy say the markets usually go up after a presidential election because the market, and by this he meant the human investors, like certainty. And 9 times out of ten the market goes up a little after a presidential election because the investors can plan for what is next.

I don't know if those are words to invest by, but I just paid off my home equity, refinanced my car loan to the same term but a rate of 4.5% and will hold most of my cash in the bank until at least after November. I think the picture on a lot of things will be clearer by then.

 

Honestly, I would not make any drastic moves until after the general election.... that will add some stability back into the market, as there will be a unified vision as to what role the government is going to play in this whole market crisis.

Honestly, foreign stocks are probably some of the surest bets out there now (IMO, compared to small and even mid-cap domestics). Investment in Europe is not too pretty now, as they are hurting just as much from the credit crunch (See the Societe Generale issues over the past month... nasty stuff). I would recommend finding companies that are investing in green energy (although not efficient enough for mass implementation yet (solar, wind, biofuel, etc), it is the "hot ticket" thing as of late... I have a feeling that OPEC is going to eventually break when China and India start slowing their growth (and thus oil consumption). There is apparently rumblings of some companies not investing in China, as it is no longer the cheapest source of labor. It might be coming in the next year, but I do not see anything happening on the oil front before at least 2009 (Plus the situation in Columbia and Venezuela is looking pretty scary now... more instability for an OPEC nation = high prices).

I would stay away from the financial sector for a while.... until this whole crisis shows signs of bottoming out. Real estate values here in FL are down almost 10% compared to last year... definite recession. The State of FL is about to cut $2.5 billion from their annual budget ($70b annually) due to low property tax receipts and low document stamp collections (used in recording mortgages here in the state).

I would recommend United Defense, as it is a larger cap company, and gets its funding from government contracts, which are guarunteed. The market for their products are limited (military), but the income stream is more solid compared to the private sector... I would invest short-term, and the re-evaluate once the general election is over (liquid in order for quick reallocation).

If you are going to keep anything in cash, I recommend the pound vs. dollar... dollar is no longer the world standard, IMO...

John

 

No? Oh really.

 

Way to bring one back from the dead. He was saying "no not Cubs2k's gif image of the perfect storm, but your (then) image of whatever it was".