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Author: brucedoe 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 35387  
Subject: Re: OT: An Ending and a Beginning Date: 6/21/2002 10:08 PM
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Well, I didn't lose everything in 1973-1974, but I did lose a bit more than my entire investment into stocks. A broker talked me into buying on the margin and I had an uncle who seemed to do very well doing it, so I got sucked in. BFI (garbage) which I bought at $25/sh and went to $35/sh before it began to drop, dropped to $5/sh and had only one losing quarter. Control Data which I bought at $35/sh dropped to $10/sh but i got out of that one at $25/sh. And so it went. I could have covered the margin calls but eventually sold all. I guess one lesson was not to buy on the margin. Another was that had I covered, eventually I would have done very well. Somewhere along the line I learned that I needed dividends, preferably increasing dividends, to let me hang in there. As to bonds, I hesitate to go longer than a 5-yr maturity, but have been flirting with 10-yrs lately, though I haven't done it. Below 5%, it doesn't seem like a good long tern deal.

This market has gotten nasty. In a bad market nearly everything goes down, including bonds though not as much as stocks. One wonders if we aren't going to see 1973-1974 all over again, except without Richard Nixon to kick around. And oil is at $25/bbl, which though not especially high considering inflation is still a kick in the butt.

brucedoe
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