Market Crisis: What to do when markets crash
Today's Financial News - Posted October 6, 2008
Despite last minute political maneuvering, global stock markets are crashing. What’s an investor to do? Run for cover — or load up on bargain?
by J. Christoph Amberger
Baltimore — (TFN):
What to do when markets crash?
Consulting guru Seth Godin said last week: “If I wasn’t already running my own business, today is the day I’d start one.”
If history is any guide, there’s just one rational way to act in times of financial pressure: When the herd is stampeding out of the equity markets, it’s time to buy stocks!
When speculators are falling over themselves trying to sell off real estate, it’s time to buy property.
It’s not without risk, mind you. But neither is doing nothing.
Look at it this way: The United States is the only — and still the richest! — first-world country still adding to its population. Each year, the equivalent of the city of Chicago is added to the overall population. In the next 5 to 7 years, the largest number of young people since the Baby Boom Generation will be pushing into the labor and housing markets.
That means that demand for rental property, condos, starter homes is pre-programmed to pick up. Meanwhile, inflation may start increasing… providing a bullish argument for leverage.
And unless the new administration manages to squelch ambition and outlaw success, the cultural and economic cornerstones of America will not change. In fact, the re-emergence of an imperial Russia and an expansion-oriented China will almost guarantee increased government spending on classic military-industrial wealth-distribution schemes.
Crisis and opportunity go together: We have been handed a centennial opportunity to prepare our portfolios for building a legacy of wealth.
Don’t Miss:
Laura Cadden- Crash 2008: The best way to play market volatility
Andrew Snyder: Dividend income: Earnings fall, you win
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October 6th, 2008 at 5:42 pm
What did anyone expect? The investors have no confidence in these corrupt politicians. This bailout is just one more example of the indivisible handjob stroking irresponsible CEOs and CFOs with billions so that they can run the American economy even further into the ground. So much for Keynesian economics. If the goal is to stimulate the economy, why not give the money directly to the American taxpayers? The government could do twice as much good for the economy by returning half as much money (as the bailout requires) directly to the hardworking American taxpayers. A bird in the hand is worth two in the bush administration.