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Technology Stocks : Cisco Systems, Inc. (CSCO) -- Ignore unavailable to you. Want to Upgrade?

To: larry who wrote (56001)	10/18/2001 2:22:18 PM
From: RetiredNow	Read Replies (1) \| Respond to of 77400

I hear you. I wonder if we're not at the bottom yet, surely we are getting very close. When I take a step back and think about the current situation, I think the following. The years 1996 through March 2000 were what people call a bubble. Another way to look at it is that all the fortuitious things that could have happened all came together in a few years in history: Telecom Act of 1996, low inflation, low interest rates, massive spending on Y2K, the advent of the Internet, baby boomers investing more money that ever in the stock market, the average joe getting themselves an online trading account, VC going wacko and investing in any dotcom with a business plan, salesmen like Chambers saying there was no end in sight, and countless other new markets opening up like India and China. Things just were so good all around. All the stars aligned briefly to create a nirvana of a bubble in the stock market. Well, now the reverse seems to be true. The dotcoms went bust, telcos and service providers are under a massive debt load, the Fed raised rates very high by last July and then waited to long to reverse course, companies like Nortel and Cisco made big inventory bets and lost, telecom spending fell off the roof, taxes are at a historical high despite Bush's most recent relief package, and to cap it all, our country and its citizens were attacked and we've been plunged into war. This is the perfect storm. The stock market is bloodied. The Dow is down 30% and the Nasdaq is down 67%. The VCs and telcos have returned to sanity in their investments and spending. Things just couldn't get any worse. But there is a glimmer of hope. If you happen to be a long term investor and you have a steady savings and investment plan like my wife and me, then you can ride this thing out. My wife and I save about 30% of our gross income. Most of that goes into a very diversified base of mutual funds across different categories like large cap growth and value, small cap growth and value, international, and bonds. These categories are further diversified among industries. Then these categories are rebalanced every year. What's more is that every two weeks when we get our paycheck, our deductions are automatically made from the gross and are invested by our financial planner and allocated across all those mutual funds. Right now, we are picking up a lot of shares on the cheap. It's simple dollar cost averaging, but I feal really good about the investments I'm steadily making now. 2 to 3 years from now, these investments are going to look really good. My E-Trade account, where I do only a very small amount of speculation will probably still look like a disaster, but at least the rest of our net worth will look good and that's what really matters. I feel very sorry for those folks who think they can outsmart the market on a regular basis. The fact is that most people have gotten hammered over the last year and a half, including us. But it could have been a hell of a lot worse had we played with all of our money in E-Trade instead of being disciplined in our approach.