I’ve got a gun and I know how to use it
Today's Financial News - Posted April 17, 2009
Sometimes all it takes is a good analogy to put things in perspective. The nation’s investors are scared to invest. Maybe at look at what timid shooters do to hit their targets is all we need to get back in the game.
By Andrew Snyder, TodaysFinancialNews.com
Baltimore – (TFN): I have never thought of myself as some sort of gun-toting extremist, but according to Homeland Security I may have to revisit my thoughts. When I sat down at the desk in my home office last night, I realized I may not be the model citizen Obama would like me to be.
After all, not only are there a stapler and an overflowing inbox lining the desk’s perimeter, there is also a brick of .22 long-rifle rounds, a handful of 30.30 shells (from my favorite Marline lever action) and I swear I hear two or three 12-gauge shells rolling around when I open the top drawer.
There is no particular reason for the ammo to be on my desk. It is mainly from being disorganized and an avid shooter. Living in rural Pennsylvania, I am fortunate enough to be able to open my backdoor and blast a few rounds whenever the mood strikes.
Of course, my in-laws from Alaska’s southeast panhandle know much more about the freedoms of shooting than I could ever imagine. Guns are like car keys in that state; you never remember where you put the dang thing.
Anytime you put a gun expert and an investing expert in a car for three hours, the two subjects will eventually converge. When it happened last week, my father-in-law created a very unique, yet apt analogy.
The hidden value of the Second Amendment
“The market is no different than a spooked shooter,” he said. “Their shoulder is bruised from shooting an elephant rifle. They only way they can stop flinching is to shoot the little guns.”
Think about it. Over the past several years, the nation’s investors have been shooting bigger and bigger guns. As the gains piled up, the leverage grew at an alarming rate. Before long, somebody pulled the trigger, missed their target and ended up flat on their rear.
With portfolios trading for nearly half of what they were worth twelve months ago, investors are too timid to even think about shooting the big guns. With 401(k)s, pension plans and savings accounts on their back, investors are unwilling to take on any more pain.
That’s okay. A debt-fueled economy was bound to fall. The sooner it happened, the better. We need to be glad America learned its lesson.
But just because our shoulders and our egos are bruised does not mean we should not be working our way back to the top.
In the shooting world, if you are flinching from the blast of a shotgun, shoot a few hundred .22 rounds down the range. Start small and work big.
It is the same for investors. You don’t have to make a thousand-yard shot, but you have to pull the trigger.
If you are like most investors, you are sitting on a larger-than-normal pile of cash as you wait for the economy to rebound. Now is the time to be slowly allocating that money to the markets. If you wait until it is obviously safe to invest, you will have missed out on what could possibly be the largest profit opportunity of the decade.
Start small. Think of broad-based ETFs or sector plays. As the greed slowly overtakes your fear, make bigger and bigger moves. Before you know it, you will be sitting on a pile of gains and your portfolio will be back in shape and you will be ready to shoot the big guns.
We may have bruised shoulders now, but we will never win unless we keep shooting.
Next Article: TFN Special Research Report: The Three Best Solar Companies to Buy Now
Be the first to leave a reply.
Your comments are welcome
Follow TFN via RSS or Twitter |
 |
 |
 |
Advertisement
Latest Headlines
- The Big Picture for Sinobiopharma, Inc. (SNBP)
- Beazer Homes USA, Inc. (BZH) and Hovnanian Enterprises, Inc. (HOV) up despite horrid housing news
- The FDA catalyst: 2010 moves in MannKind (MNKD), Roche Holding (RHHBY), Acorda Therapeutics (ACOR) show it still works!
- Steepest drop since Feb. 2009: Here we go again!
- Is the silver run over? Coeur d’Alene Mines (CDE), Silver Wheaton (SLW), Alto Group (ALTO), Hecla Mining (HL), Endeavour Silver (EXK) close down