Posted on 10/10/2008 6:52:10 AM PDT by disraeligears
Caveat: None of the following is to be relied upon by anyone for anything. Anyother words, I have no idea what is going to happen in the financial markets, and if anyone tries to tell you differently, they are a bloody fool!!!
That said, before going to law school, I was a stockbroker (I know, I know, next it is selling used cars). I remember looking at my Quotron in 87 and seeing the Dow drop 25% in one day!
Never paid much mind to the charts (was always zeroed in on fundamentals).... BUT, recently, when I looked at the Dow over the past 12 years or so, support looked to be at around the 7600 level (July 2002).
Then I looked at the Dow since around 1935. Using my old ruler and drawing a line throught the market accretion since then (1935), it looks like the DOW would naturally be around 6000 if not for the past activity of 20 years or so.
Any ideas?
I agree. The faster we collapse the less harm, and the faster we can start growing again. We live in interesting times : )
There will be just one bottom, but I won't be able to tell you when until a year or two later : )
The best way to buy in now is to cherry pick stocks that were too expensive and do small buy ins.
I am getting antsy. The buying opportunities are going to be great.
What are you looking at?
“...is spurred by people trying to raise capital to fill obligations.”
I need to pay my taxes. I called my broker where I have a reserve account of “cash” to tap into it. He said the account has been frozen for 3 weeks. It had 3% of its assest with Lehman’s and the Fed put a freeze on it to sort things out. I may be able to some of it out on Monday - but not enough.
Time to go check online with my bank and make sure that my home equity line of credit is still available for a short-term loan.
Then down to the bank itself for some cash.
Scary exciting, but even with all my losses this year, I don't feel like a loser. I feel like there is a huge opportunity unfolding for me.
Hmm, What brokerage do you use? My cash is in a series of bank accounts linked to ETrade. I haven't checked to see if they have withdrawal restrictions. I am not very worried because they are FDIC backed.
I share that dilemma. I think there will be multiple bottoms. Two or more, due to the volatility fears and news that will dribble out over the next three or four weeks. I think getting in today depends on your tolerance for more losses. I may wait for the second bounce.
I agree. Most of my investments are above sell points that I had mentally put in place just 2 years ago. So even though I am getting slammed right now, my cash position is good.
The problem is that I am seeing a paradigm shift again and all I know is that the next growth stocks will not be tech, financial or energy. Maybe I will fall back on my old stand bye technique of waiting to see which way the wind blows : )
It is called the Reserve Primary Funds (RFIXX).
My broker said that three weeks ago 14 of these types of funds were frozen. 11 of them have been freed up. He said that 25% of mine would be freed up on Monday. So not sure if the other 11 were freed up 100% or just partially.
I did click the mouse button and borrowed from my home equity loan and into my checking account so I can pay my taxes. I’ll double check before I write the check next week. Don’t want my check to bounce to the U.S. Treasury. I wouldn’t want those AIG managers to lose their penthouse suites, or the illegals lose their $500,000 home with no money down.
Anyway - off to the bank to get some cash.
Then to Costco.
Then to the sporting goods store to load up on precious metals.
Financials are probably going to lead out for a short time as they are so beaten below their actual physical asset values, but PE's are totally impossible to ascertain and they will not go up much, perhaps a one or 1 1/2 bagger for the best in sector.
Long term it will be businesses that sell stuff or services that make sense. I want to diversify and wait for a year or two.
I hear that!
I work hard for 40 years.. and Now... well at least I get the Max SS benefits.. Guess they were right.
NO smart ass remarks from all you younger folks... I worked and I earned.. and now I am really pissed.
(Oh and yes, I moved into bonds and Money market.. I am still getting clobbered...)
I’m not looking at any specific stocks yet, just seeing a climate that is over sold. I need to start studying and looking for the good buys. I’ll give you an example of my thinking though...
The banking sector is being pounded and being rebuilt before our eyes. It is going through massive consolidation. In the end, banking will be dominated by a few huge banks making all the money (IMHO).
Thinking that way, relate it to what happened after the tech stock crash. Consolidation shook out a few big stars. Amazon was the only game in town for auctions and was a great buy. Google was the last search engine standing and was a great buy.
Coming off this banking consolidation, I am looking at Goldman Sachs or JP Morgan as among the last men standing in banking and thinking that, with the collapse of their stock prices, one or both of them will ultimately be a very good buy. I don’t mean anything I can buy this week or this month. But coming off this liquidity crisis and massive banking consolidation, we are going to see the few last men standing, be they GS or Bank of America, whoever, really get huge earnings as they gobble up all of the remaining business.
I’m looking for companies like that. Sectors that are getting pounded and consolidating, I’ll be looking for companies that survive the collapse in their sectors and are ripe to dominate their market.
I won’t know this until we get through the current crisis and things begin to settle down and we know who the clear winners are and who has disappeared or been bought up.
My plan is to put everything in an S&P 500 index fund and then gradually target irresistable buys as they are laid at my feed. No plan goes smoothly, but that’s the plan. Nothing in the next few months as this crisis has to play out before I can get a grasp on the winners and the losers.
I like the way you think : )
I ended up going to the sporting goods store first. Then to Costco. Came home to the newspaper with headlines about Costco’s booming business. Wasn’t too busy - but glad that I didn’t wait for the weekend once folks see the headline.
While I was shopping I was looking at ALL OF THE STUFF! (And wondering if it would be like that next time?) And all of the people BUYING THAT STUFF. Huge stuffed animals that filled up a cart. GPS systems, Big screen TV’s. Glow in the dark tree with stand (Halloween or Christmas already?).
I sure hope those people are right and I am wrong. However, based on the amount of Obama stickers in the parking lot, I have a feeling the overall IQ was fairly low after I left.
The Dow was around 9000 when I posted the above. It closed this week at 7365 so, sadly, we are almost there.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.