Friday, October 17, 2008

My take on the stock market – October 17, 2008

As I write, the stock market has suffered a year of moderate decline followed by two weeks of steep declines. This is a consequence of the incredible lending practices of the past five years. People now think that their investments are going to be worthless and they should retreat from the market while they can. Depending on your circumstances, this could be a mistake. If you do not need to sell your stock market investments any time soon, you should either “stay the course” as John Bogle advises or buy as Warren Buffet is doing.

3 comments:

norm said...

Absolutely sound advice, as I understand it. Folks who bail out at a loss will probably regret it later.

Michael Hehir said...

Selling because stocks are "on sale" doesn't make any sense to me.

I'm glad to see that both presidential candidates have called for a suspension of mandatory distribution rules for IRA and 401(k)s, but Obama's idea to allow penalty-free withdrawals seems to be pulling in the opposite direction.

Joseph J. Hehir said...

Yes, Obama’s idea is a foolish one, especially for young investors. Now is the time to “stay the course”, or better yet, to BUY, BUY, BUY.