Boiler Room 7/17/00
On Friday or Saturday evening my wife gets a movie from Block Buster and after dinner we sit, hold hands and watch. This week she brought back one that I think every investor or anyone contemplating investing in the market should see.
The Bottom?
Every day I hear someone on CNBC proclaim that "this is the bottom" and you should get in there and buy all those "bargains". "The valuations of the DOW stocks are a steal.
Bottoms Ups
If you have talked to a stock broker or financial planner in the last few days I will bet they all agree that there are some great bargains out there and now is the time to start buying in anticipation that the market will go back up. You will also find agreement from the talking heads on CNBC and those talk radio station stock mavens.
Dont Buy Stocks based on P/E Ratio alone
I use the P/E ratio as a secondary indicator for buying and selling stocks but I don't use the ratio in the same a manner as many value investors teach. I will explain the difference in my methodology for using the P/E ratio to your advantage.
Box Of Chocolates
Ever have one of those sample boxes of candy? Each little piece is beautifully wrapped in colorful foil or decorated with an interesting design. Taste just one.
Bull or Bear?
Cat or dog? Maybe Zebra. Shucks, I don't know, but my broker keeps telling me it is a bull and to buy this and that.
Buy and Hold Investment Philosophy
Wall Street has been preaching the doctrine of Buy and Hold forever. The worst part about it is the small investor (and some big ones) actually believe it.
Buy Low - Sell High
Now where have I heard that before? I know. It was my broker.
Buying Mutual Funds
It looks like the market is ready to start up again so it is time to buy mutual funds, but you only want to invest your money in funds that go up. First, you don't want to start with a loss so be sure to purchase no-load mutual funds.
Buying New Issues
Has your broker been calling you recently with the "great opportunity" to get in on a new Initial Public Offering? With friends like that you don't need any enemies.I don't care how good this new stock offering sounds.
Investment Capital Gains
Have you bought any mutual funds this year or late last year while the market was doing its skyrocket thing? Last year it was hard to lose money. This year it has been easy.
Cash
How many people went to a cash position this week? There is no question that this market has scared the bajebers out of many investors, me included. Fortunately, I started going to cash some time ago, but I did give back a substantial amount of my profit.
Catnip of the Stock Market
I have watched my cat play with a bag of catnip. At first he is having fun and slowly he becomes drunk with pleasure and then finally he becomes so tipsy he falls over to sleep it off.
Chart Reading
As an investor you will want to check out any equity before you buy it. Many investors go to Morningstar that is one of the largest providers of mutual fund information in the world.
China Syndrome
There has been great condemnation recently because China has been selling its goods on the world market at prices below what other countries, especially the U.S.
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