Are we there yet?

Replies to This Discussion

Permalink Reply by Miffy on July 12, 2008 at 12:58

Nope. I wonder if JG still thinks this is a good time to get in as markets around the world continue to plunge?

Beginners would be down 10% in some cases had they invested when JG thought it was "a good time to get in"

I may sound like a broken record here, but when the market is like this, it is NOT the time for beginners or the faint-hearted.

Sure you can get in at what seems to be a low, but you can also get burnt so badly that you may never invest in the market again, which would be a shame as you can make great money at the right time.

I personally am staying on the sidelines for a while, taking my 8% from cash, while protecting my capital. Got to love that.

Miffy

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Permalink Reply by JG on July 12, 2008 at 14:47

Miffy are you too stupid to read a question mark?

Obviously.

10% down before the bottom isn't a bad place for a countercyclical investor in for the long term.

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Permalink Reply by Miffy on July 12, 2008 at 16:47

Hmm, interesting that you are resorting to insults. I can put that aside and rise above it as I think this is an important discussion.

What I am trying to do is to make sure that people don't get burnt by putting their hard-earned money in only to see it disappear. Particularly those starting out.

JG wrote on the 4th July:

"sometime around now would appear to be a particularly auspicious time to start investing..."

And the market has fallen ever since.

Sure, the market may go up again and this could be a great time to buy. But with companies like Freddie Mac and Fannie May - two of the largest finance companies in the US - in all sorts of trouble (see this article here), and markets around the world looking shaky, it's easy to think there is value in a "cheap" stock, when there is not.

Everyone thought Macquarie Bank, ABC Learning and Babcock & Brown were great buys only for them to plunge.

Investors need to be careful, and in a falling market with high rates available on cash, people would be wise to at least consider cash as an option rather than shares.

Miffy

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Permalink Reply by Mary M on July 12, 2008 at 22:12

JG, there's only one thing that's obvious here - your comments reveal much about the kind of person you are.

As do my comments, I suppose...

Miffy, good to see you're taking the higher ground here - you're right, this is an important topic to discuss.

I know loads of people who are too scared to invest after having stuffed up in the past, so you're right in saying that it's important to be careful. But all investment involves some element of risk, even putting your money into cash.

Although JG has stooped to writing abuse rather than arguing his case, he is correct in saying that even putting your money in the bank is not entirely safe. Banks can and do collapse, and the higher interest rates that you can get now are a reflection of the problems banks are having in raising capital.

However I agree with you Miffy, better to sit on the sidelines in cash than risk chucking money into a volatile stockmarket that seems more likely to go down than up. Fear has set in and that's a dangerous element in any forum of life.

Mary M

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Permalink Reply by Bandwidth on July 16, 2008 at 16:08

Hello Miffy

The big problem with telling where the bottom and top of the share market is, it is ver easy in hindsite.
One thing for sure is that when the market recovers there will be good gains to be had. The bottom should be more evident when there are rises and the sentiment changes.

As far as press comment is concerned I find there is about a 6 week "press lag" in the share market and a 6 month lag in the property market. "press lag" is the amount of time it takes the general press to comment on what is happening.

While the market reacts to ANY news with a downturn the bottom may have room to go.

It should be noted that not all sectors suffer in tandem have a look at the energy and materials sector. The big loser at the moment is the financial sector.

As far as brokers are concerned I find online brokers easier to access when the market is volatile and at the moment any brokers guess is just that a guess.

Looking at a weekly chart of the All Ords we are back to the same prices as Jun 2006 from there the market went flat till Sep 06 so if we have a groundhog day then Sep :-)

My observation is that, over time, End Jun through Jul has not been healthy for the stock market with a tendency to recover in Mid Aug through Sep

BTW Nobody rings a bell at the bottom and top of the market

Bandwidth

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Permalink Reply by Jo Fox on August 4, 2008 at 17:15

In the last bear market I made a considerable profit "day trading" as well as picking up shares very cheaply that went up. If you're prepared to wait it out I wouldn't be concerned if its bottomed there are some good pick ups to be had if you have the intestinal fortitude to sit it on them even if you have to watch them go further down for now.

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