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  • Back at the Bottom [View article]
    "No thanks! I'll stay short the market until real indicators tell me it's safe to go long." -sbenard

    On the day that indicator arrives, you will be squeezed out of your shorts and your options investments will be worth zero. Unless you get tomorrow's news today, good news will be reflected in stock prices. Since you know that day is coming, and you don't know when, isn't this strategy suicidal at some point?

    Bottom line is:

    Investing in this volatile, uncertain environment is dangerous in the SHORT TERM, and the author is right to suggest you consider your life situation before diving in with a plan of cashing out within a year. It could go lower - but that was always the case!

    However, buying at low prices, even during periods of uncertainty and volatility, is safer in the LONG TERM because you are paying less for future earnings. Unless you think we will all be subsistence farmers in 10 years and have no use for products and services, those earnings will be higher.

    Ironically, it is when short term risk is highest that long term risk is lowest. If that gap shakes out all the institutions, day traders, hedge funds, and naive news-followers, then perhaps it is time for buy and hold.
    Nov 13 12:41 pm |Rating: +1 0
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