THE DOW: A 938 POINTS GAIN???
October 14th 2008 00:00
WOW!
Hold on a minute… that was a euphoric reaction. Let’s make room for a few moments of calmness before we proceed…
Okay, I am a newbie and I would not know this from experience, but people are saying that what the DJIA just exhibited today (yesterday here) was totally unexpected that, if the stock market is a pole vault event, it didn’t jump. It flew!
Reports that came out after this massive show says that the biggest one day jump the Dow made was 499 points back in the dot com boom of 2000.
Of course, the sad reality is that 938 points is way down there compared to some 2400 points shed by the US market last week. But the fact that it was gained in one day somehow erases the notion that the market is dying or rendered very weak by all those toxic derivatives.
A thought that has been painting morose faces everywhere.
Now, that 11 percent (938 points) gain, at least to me (a newbie), showed that the market actually has a lot of verve left and it is only acting the way it has been because it is already tired of all those garbage it was being fed. Ha! What CDOs, CDS and subprime bulls?
A guy somewhere has written something about the purpose of the existence of the capital market - and that was to support the real economy - the real economy being the industries that produce goods and provide services. But somehow, some financial wiz kids got too greedy and whacked and tried to create another economy that is based on soap bubbles - and look what we got!
But that is not the point that I would like to drive at today. What I would like fellow newbies to mull over today is the relevance of what the market just did to their investing “game plans.”
Timing the market is hard even for seasoned investors or stock market professionals (unless you have a Louie on your side who seemed to have read correctly the signs of times. Check out her post of Oct 8, 2008 here: Really Long Link But there are other ways of hitching a ride into the stars.
One of which is by carefully selecting your stocks (and I would like to double emphasize the word carefully) and, once you are certain, by daring to go in even when there’s a “bloodbath.” And that is simply because that’s the time when you have a better chance of getting them at a bargain price.
Before you leave this post, though, please bear in mind that this is a newbie’s post who is just expressing a newbie’s opinion. Very carefully, do study your other options.
And NEVER forget, nobody is talking here about a bull run.
Hold on a minute… that was a euphoric reaction. Let’s make room for a few moments of calmness before we proceed…
Okay, I am a newbie and I would not know this from experience, but people are saying that what the DJIA just exhibited today (yesterday here) was totally unexpected that, if the stock market is a pole vault event, it didn’t jump. It flew!
Reports that came out after this massive show says that the biggest one day jump the Dow made was 499 points back in the dot com boom of 2000.
Of course, the sad reality is that 938 points is way down there compared to some 2400 points shed by the US market last week. But the fact that it was gained in one day somehow erases the notion that the market is dying or rendered very weak by all those toxic derivatives.
A thought that has been painting morose faces everywhere.
Now, that 11 percent (938 points) gain, at least to me (a newbie), showed that the market actually has a lot of verve left and it is only acting the way it has been because it is already tired of all those garbage it was being fed. Ha! What CDOs, CDS and subprime bulls?
A guy somewhere has written something about the purpose of the existence of the capital market - and that was to support the real economy - the real economy being the industries that produce goods and provide services. But somehow, some financial wiz kids got too greedy and whacked and tried to create another economy that is based on soap bubbles - and look what we got!
But that is not the point that I would like to drive at today. What I would like fellow newbies to mull over today is the relevance of what the market just did to their investing “game plans.”
Timing the market is hard even for seasoned investors or stock market professionals (unless you have a Louie on your side who seemed to have read correctly the signs of times. Check out her post of Oct 8, 2008 here: Really Long Link But there are other ways of hitching a ride into the stars.
One of which is by carefully selecting your stocks (and I would like to double emphasize the word carefully) and, once you are certain, by daring to go in even when there’s a “bloodbath.” And that is simply because that’s the time when you have a better chance of getting them at a bargain price.
Before you leave this post, though, please bear in mind that this is a newbie’s post who is just expressing a newbie’s opinion. Very carefully, do study your other options.
And NEVER forget, nobody is talking here about a bull run.
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