Stocks: Old Bulls Losing Their Steam

Even eternal stock market optimists are losing their nerve these days, but Fidelity’s Peter Lynch still says, “But at some point in the future, I think you’ll look back and see that we’ve gotten through this,” and that “stocks turned out to be the best bet.” Personally, I’ve started to look at it as throwing money down a magic wishing well, or planting magic seeds that will take 10 years to grow (it’s amazing how adding the word “magic” to anything makes it a little more psychologically palatable). [NYT] (Photo: ynskjen)

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  1. ojzitro says:

    Tough timing on this article…markets are ripping higher on Citi news and Bernanke addressing mark to market policy changes.

  2. Anonymous says:

    Just wait till tomorrow…they’ll be back down

  3. HIV 2 Elway says:

    Cut capital gains tax, watch investment dollars fly in from the sidelines.

  4. ojzitro says:

    @oneliketadow: Only said it was bad timing, didn’t say a thing about anything being over. Although, media and pundits are always grimmest right before the turnaround.

    An hour into trading, 157 million share have been exchanged, that is heavy volume. There is a strong chance traders sells this rally before the close, but I hope it sticks, we need it.

  5. nataku8_e30 says:

    Hrmm, if thinking of investing as throwing money down a wishing well eases your mind, you may not have very good financial sense…

  6. darkryd says:

    Thanks for the cheerful article, Consumerist.

    Mind giving us something positive to look forward to?

  7. mac-phisto says:

    some stocks will have turned out to be the best bet. i think one thing we’ll learn (hopefully) is gone are the days of willy-nilly investing. break out those financials & chose your horses wisely. look for companies that have long-term goals as their primary focus & stay away from those positioning themselves for the quick return.

    that’s really what investors should have been doing all along, but many people got wrapped up in the easy returns.

  8. SexCpotatoes says:

    Is the “old bull” headline about the old parable about the young bull and his father?

    One day an old bull and his son were standing on top of the hill surveying all the pasture and the cows beneath them. The young bull stamps impatiently, and says to the old bull, “Hey pa, let’s run down there and nail ourselves a cow!” To which the old bull replies, “Why don’t we walk down there and nail ALL the cows?”

  9. ChapstickAddict says:

    I’m 25 and sticking to mostly index funds in my IRA. The way I see it is I’m buying all these stocks on sale. Either the market will recover sometime before I’m ready to retire or the entire global financial system will collapse and my paper money won’t be worth anything anyway.

  10. kwsventures says:

    In 1932, the Dow Index hit a depression low of 40, yes, 40!. It hit a high of 14,100 in Oct. 2007. Now it is 6,800. Now think about the next 70 years. Will the Dow ever go back up? Jeez, what do you think?

    • limiter says:

      @kwsventures:
      The stock market crash in 1929 took until 1954 to just to break even, almost 30 years. There is no guarantee the stock market will recover as quickly as it has in the past. The stock market is not a sure thing.

      To quote the wikipedia article “Anyone who bought stocks in mid-1929 and held onto them saw most of his or her adult life pass by before getting back to even.”

      [en.wikipedia.org]

  11. ojzitro says:

    Chapstick,

    Corporate bond funds are a safer bet……You get some upside as equities move higher, IF they move higher. If they don’t you’re still collecting a good yield, which you will hopefully reinvest.

  12. KyleOrton says:

    These rallies are great for transferring money from the middle/upper-middle-class amateurs to the wealthy pros. The market rallies a bit, the big boys sell off and all of the little guys are left wondering where that rally went.

  13. Blueskylaw says:

    @kwsventures

    It’s nice to know that I will be 105 years old before the market rallies back.

    I will be sure to celebrate with a spin in my grave.

  14. EasttoMidwest says:

    The issue isn’t that stocks have fallen too low, it’s that people bought when they were too high. If you invested in 1987 (pre-crash, even), you’d be up a nice amount TODAY. About the same as if you bought in 1967 and withdrew in 1987.

    Short term investors are having problems; people who borrowed against illiquid assets are having problems; people who didn’t move their money out of volatile investments (i.e., the stock market) and into sounder, lower yield ones as they approached retirement are having problems.

    Basically, anyone who followed the ABCs of investing is doing fine. Maybe not as well as they thought, but about as well as they should be doing, historically.