I listened to the Saturday morning radio financial show today and boy are a lot of people concerned. Still, several unifying themes from the financial advisors are
- don't change your plan and stick with it (one size fits all mentality, don't change with time because your plan is a time-tested one).
- this is the opportunity to buy, not sell (assuing of course the market will rebound and go back up again).
- think long term (but they did not specify what long term means, till one dies?).
- don't be afraid to sell the losers but hang on to winners (ya right, everything is a loser if one bought recently).
I have to admit these are pretty sound advise but this set of advice and mentality works well in the market of the past five years and there is no guarantee it will work in the current environment, and most probably will not work in the next five years.
I am willing to bet the moms and paps are beginning to taste some bad medicine and they are CAUTIOUS now. Being cautious does not mean they will not go out and buy more, but they will not chase them like they used to. Should the market tanks some more, they will buy more, kind of like averaging down. However, there will be less net buys and more net sells by these moms and paps each step of the way down if the market indeeds goes down slowly from here and enters a bear phase.
LT - why a crash on Monday? So you agree we will have a big LT again on Monday? |
