I hope anybody who has excess cash laying around is busy coming up with a plan to put it into the stock market sometime soon. This is the time to get involved as a long-term investor. It’s possible that the market will drop further, who knows. But right now it’s the cheapest it’s been since April 2003. For some perspective, check out this chart of the S&P and click on a 10year view. In other words, if you invested in 2003 and held on til now, you’d have the same value of stock. Of course, you’d probably have gained dividends over that period of time. But the point is, you can’t go wrong buying when stocks are this low, so long as you won’t need the money for at least a few years.
When the market is this fearful, you can even earn a good amount of money by investing in blue chip stocks, the most reliable (and usually more expensively priced) companies out there. When the market panics, they sell everything, completely irrationally. Nobody cares about value any more, they’re like a bunch of lemmings running off a cliff together. The smart money is investing now while the market is low – that is how you build real wealth.
Let me emphasize that I’m not saying the market will go up immediately, and I think it may very well go down even further. But buying here, I think that in 3 years, you are bound to have made some money. Quite possibly a lot of money.
Disclaimer: I’m obviously not an investment professional. I take no responsibility for your investment decisions.
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