Date registered: Aug 2005
Location: Lawrence, KS (USA)
Mentioned: 0 Post(s)
Quoted: 3 Post(s)
The end is (not) near!
Every time you turn on the TV, it seems as though the news is negative regarding the economy, the dollar, the stock market, banks, credit, real estate, oil, etc. Plus you have the election bickering, now the Spitzer scandal, and the Federal Reserve appears to be in "panic" mode.
However, please remember that the media present the sensational. It sells. It gets attention. Bad news gets more attention than good news because of the alarm factor. So, good news gets swept aside.
But, is there any good news? Of course there is. Mortgage refinancing is actually at its highest level since March '04. New home inventories are at their lowest level in two years (meaning over-supply is reducing), lower interest rates mean lower borrowing costs for consumers, the global economy is strong, retail sales are sluggish, but not disastrous, unemployment has risen, but is still below 5%, and S&P sees an end to subprime mortgage writedowns. So, not all news is bad news.
Does this mean that we are headed straight up from here? No. I still believe there are some major structural issues with the financial markets. However, even when things look bad, they are usually not as bad as they appear. And, if you look at the bad news, you miss the opportunities that are developing.
I believe an opportunity may be developing now. One of my market indicators has flashed a major buy signal. This indicator will issue a buy signal when the markets have fallen significantly and look to be poised to turn around. Since 1991 (the earliest data I have), there have been ten times in which markets fell to this level and a signal was generated. In EVERY case, the market was significantly higher within a few weeks.
Accordingly, I believe that a few weeks from now, we will be able to look back and see that this was a good time to buy. It may sell down a bit more between now and then, but historic precedence supports this view. Time will tell!
Don't believe everything you think