by The Investor on April 4, 2008
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Stock markets have been falling for months, led by a collapse in confidence in the financial system and plunging bank stocks. In the UK we’ve seen Northern Rock crumble, while in the US the investment bank Bear Stearns lived up to its name after jitters led to rumours which led to a run on its assets, ultimately forcing it towards bankruptcy and into the arms of JP Morgan.
I happened to watch some of Washington’s investigations into the Fed-backed buy-up of Bear Sterns on Bloomberg yesterday. The CEOs of both Bear and JP Morgan were there to account for themselves, sitting side-by-side as if in some slow bit of a Shakespearian tragedy. (You can read JP Morgan’s testimony over on Forbes).
I’ve also watched Fed chairman giving evidence in recent months defending his attempts to alleviate the blockage in the credit markets, and his deep cuts in interest rates.
What’s all this mean, apart from that I need to get out more?
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by The Investor on January 22, 2008
I’m not a professional trader. I’m an everyday investor, like you. Why then am I buying in a bear market?
As an everyday investor, my decisions affect the quality of my life. I can spend my money on stocks and shares or I can have more fun flying to sunnier lands to go surfing, or on splurging out on a new TV. (I was supposed to be on holiday this week, although closer to home. My plan was to catch up on odd jobs around the house and finally take my new-ish Nikon D40x camera out for a spin.)
This morning though I was at my PC at 7.45am, ready for the opening of the London Stock Market. I wanted to wake to a sea of red, and I got it. I was bright-eyed and bushy-tailed, and I purchased shares in a FTSE 100 ETF when the market was at 5360. As I start typing this post, it looks a brilliant move – the market has moved 300 points higher since my buy. By the end of the day, it could seem the greatest folly, if the market reverses and crashes 10% lower.
How on Earth are you supposed to trade shares at times like these? Well, my approach at all times is to be ‘fearfully greedy’.
It may sound like something you’d hear an English child exclaim in Mary Poppins, but being fearfully greedy actually has its roots in the Omaha wisdom quoted above. And I believe it’s the only way I’ll ever get rich through investing.
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by The Investor on September 2, 2007
You’ve bought a share and – ye gads! – it’s gone up 30%. Should you sell it and take the profit? It sounds like a simple question, but the answer, my friends, is complicated and controversial enough to give us the stock market we know and love, with all its wild oscillations in share prices, swings of fear and greed, bubbles and bursts and even the odd lonely leap from a bridge.
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