Skip to main content
Message Font: Serif | Sans-Serif
 
No. of Recommendations: 0

OK, since I am a new guy here and really don't have any experience in investing or the stock market I've been doing alot of reading.  There is alot of doom and gloom out there.  So my question is, "is there going to be a crash?"  I went to wikipedia to get the definition of what exactly a stock market crash is.  And this is what I found:

"A stock market crash is a sudden dramatic decline of stock prices across a significant cross-section of a stock market."

It also says the crash is driven by underlying economic factors and PANIC!  From what I understand the underlying economic factors are there.  The realestate problems, companys like Intel worse then expected profits, Citigroup, and Merrill Lynch & Co having huge losses. 

Is there panic?  I read some articles saying yes and I read alot of articles that really to me seem to be begging readers not to sell and to hold on to there stocks because if they sell they could be adding to the "problem".  So is there panic?  If there isn't then why beg readers not to sell?  If there isn't panic will there be? 

So from where I sit it looks like all the signs are there.  So what does everyone else think?  Am I reading to much in this or am I just totally lost in the sauce????

 

Print the post Back To Top
No. of Recommendations: 0

We are no where near panic.  Panic is the s&p at 500, the dow at  5000, the nasdaq at 250, google trading for 50, brk-a trading for 1000k - that's panic.

IMO market participants are not panicking enough.  The begging readers not to sell thing is ignorance, pure and simple, as they should have told readers to sell last year, and a 15% correction, you still likely have gains if you bought in 2002-2003, take your profits now, and heck, invest in a short fund etf like skf or qid, but many websites aren't set up for a truly bearish scenario.

The Dow will be lucky to finish in the 5 digit range this year. 

Print the post Back To Top
No. of Recommendations: 0

Demon is a bit of a pessimist:-)  His numbers don't represent panic; they represent global financial collapse and possible armageddon.

I think you'll start to see panic today. Dow loses 5% or more and people really start to get scared. There are definite underlying economic problems, but if you enjoy investing, you will find that times like these are much better opportunities for making money than the go-go happy times when everything is overvalued.

Here are the rules:

1. Make sure you have some cash

2. Make a list of quality companies

3. Determine a price that you think is a good value for those companies

4. If the price falls well below where you consider the company a good value, buy.

5. Remember, this isn't the end of the world, and if it is, we're all hosed anyway, and losing your money will likely be the least of your concerns.

Enjoy the ride.

Print the post Back To Top
No. of Recommendations: 0

google trading for 50, brk-a trading for 1000k

While I agree that GOOG at 50 is a bad sign for the market, I don't know why BRK-A trading at 1,000,000 is such a bad thing. ;-) 

Print the post Back To Top
No. of Recommendations: 0

Yesterday was a crash around the world, but our markets weren't open.

A bear market is on us, but not necessarily a crash.  I'm hoping for a drawn-out bear market so I can come up with the cash I need to buy at the bottom.

Print the post Back To Top
No. of Recommendations: 0

I'm sure there were "experts" cautioning people not to sell in October 1929 and October 1987, and I know there were people preaching patience throughout 2000 and 2001.

The one key requirement of a stock market crash (or bear market) that you didn't include is an over-valued market. 9-to-1 margins helped stocks to become over-valued in the late 1920's; the market doubled in value in only 2 years in 1986 and 1987, then promptly crashed; and pie-in-the-sky earnings reports contributed to the valuation bubble in 2000. Today the market is over-valued in terms of dividends/price. The dividend yield of the S&P 500 has been below 2% for several years now, and that has never happened before in the entire history of the stock market. It was only a matter of time before investors got fed up with stocks that didn't pay dividends.

Print the post Back To Top