Saturday, October 18, 2008
Words of wisdom from Da Man
So the stock market is all over the place, and the "R" word is being thrown around. (An aside... does anyone actually know what the definition of a recession is? Everyone's afraid of it but I bet no one really knows what one is). This is the 2nd or 3rd economic downturn in my life, and each time it happens I keep trying to figure out how to best benefit from it. I think the one thing I've figured out is to make this a buying opportunity. Well "Da Man" in the stock market world, Warren Buffet, wrote this article that was really good... basically his mantra is "Be fearful when others are greedy. Be greedy when others are fearful."
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5 comments:
Dale - you are looking for "two consecutive quarters of negative GDP". I think most believe that is a trailing stat so maybe we are in a recession now but it'll take a bit for the GDP to reflect it. I think if you can buy the S&P 500 at a 40% discount for an economy that has yet to shrink, you're in the money long term.
I am very big on "buy now...buy buy buy!" (not just anything, but certain things are at a great deal that will recover) unfortunately i am not in a position of disposable income to enter the stock market at this time. grr. luckily it usually mkaes a swing like this every 20 or 30 years, so I'll catch the next wave...even if it's not as extreme.
Actually I think it happens every 7-8 years... in 2000 there was the dot com bubble.
well, technically, it's 2 consecutive quarters of negative gdp GROWTH. I don't think it's even possible to have negative GDP. anyways, the definition is arbitrary. would you say that 2 quarters of -0.01% growth is a recession whereas 2 quarters of +0.01% growth is not a recession?
regarding Buffett, yeah, he's a genius and i respect him the most out of all the financial gurus out there. But it's pretty easy to say those sorts of things when you're the freaking richest man in the whole entire world!
I bought GEX, an alternative energy index fund that I am banking will jump when Obama wins (up 11% so far in 1 week).
Dave
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