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Author: joelxwil Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 75379  
Subject: Re: Question about my investment strategy. Date: 9/16/2008 9:31 AM
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I find it remarkable that with the markets in such decline, you are worried about asset allocation. How about 100% cash for now?

Of course, people will say that is market timing, and it is impossible. Those of us who are in cash because we have timed the market just laugh. We have not lost money.

There may be some bargains out there now, but only if we do not slip into a recession, which would certainly cause the markets to go lower.

An agile trader may find some decent trades, and some investors may find "value" in some stocks at this time.

So far as I am concerned, the risk is just way too great, and I have seen "value" evaporate rather quickly. Some people saw "value" in Lehman.

AIG will almost certainly go bankrupt, and Washington Mutual will probably be the next crisis. After that, what? Nobody knows, but it is not likely to be good.

Of course, many people have made money in this market by being short. I have friends who have done very well with the "short" ETFs. I view it as one of my failings that I have not taken that opportunity.

Anyway, the bottom line is that you need to look at market conditions before you invest. Then you need to look at the individual investment vehicles and pick the best ones for the moment. Then you need to continually re-evaluate.

Some unfortunate woman called Cramer the other night to say that she had owned Fannie and Freddie preferred stocks, which essentually no longer exist. I feel sorry for her, but the fact is that if you do not monitor your investments, this is what can happen. Nobody with any sense has held any of that stuff for quite some time. Simply too much risk.
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