With all of the pessimism in the market these days, how many more weeks/months can the bull market hide still? I get the feeling this older bull on the left is just sitting back telling the young one on the right his stories of glory and has forgotten to do his job lately. I drove down to our farm in middle Georgia on Monday to make sure bulls still exist. Yes, they do, but just not on Wall Street lately.
So, what I’ve been wondering is how much longer before this little guy can grow up enough to get us back to easier profits. From what I understand, everyone knows there’s a chance of recession and nobody wants to be the first one back in to start buying in case that becomes a reality. If a recession comes then stock prices will hopefully already be priced in to accept the lower profits, but what if that ominous recession doesn’t hit and we melt our way back up. I’m starting to wonder if this is actually the time to get back to being more heavily invested soon. The problem with that is markets are not rational when it’s time to buy and when it’s time to sell. Both sides almost always go to the extreme due to greed and fear or even both. I keep wondering if it matters that many stocks might be priced right now or if panic will reign for longer and hurt any real chances for good returns in 2008.
I’d love to have the guts (I could have used another reference to the picture above, but I’ll keep this clean) to jump in head first while the markets are down right now, but I can’t seem to be able to pull the trigger yet. Maybe it’s these 1-300 point swings we’re getting daily now that is keeping me on the sidelines, but I know it won’t be long before I find some stock I like, aside from livestock.
All good things come to an end. In the UK the stock market has been a great arena for profit over recent years, however things have certainly become more shaky and volatile.
It may well be a temporary thing, once all the credit crunch problems start to level out on Wall Street, and in fact across the globe. Agreed though, no one wants to be first in.
It would be nice if the market recovered, but it’s looking doubtful. If you’re interested in fundamentals, you might want to read William Bonner’s books: Financial Reckoning Day; Empire of Debt; and Mobs, Messiahs, and Markets.
Maybe you could bet on the little guy with futures.