Second, be sure to buy stocks that have plenty of equity and very little debt. While interest rates will most likely stay low for a while (until inflation from too much government spending comes into prices), any company relying too much on debt may need to refinance a large portion of it this year. That refinancing may be impossible in a very tight credit market. Also, too much debt, no matter what the interest rate, takes away cash that companies can use to hire, expand, or pay dividends.

Third, buy stocks with good dividend yields. If a stock goes down 10% in a year but pays a 5% dividend, it cuts the loss in half. Or if it goes nowhere for a year, at least you'll have income while you wait for better days. Be sure the dividend is safe (doesn't take more than 30% of profits to pay). Even better: buy stocks that have increased dividends every year for the last 10 years, through good times and bad.

Fourth, stick with stocks that have a large capital base. Again, that means plenty of equity and not much debt. They'll most likely need to use some equity as things may take longer than anyone can imagine. Companies with small amounts of equity (like homeowners with no savings to pay the mortgage if they lose their jobs) can't weather these economic storms and have very little flexibility. Companies that have a large equity cushion can sustain losses and survive much better than competitors with small equity bases.

Fifth, make some assumptions, not based on the past, but what you think might happen for the next year. Where will interest rates go? Which industries have already discounted the worst scenario and their stocks punished beyond reason? Will oil go back up? Will it go down further? In other words, you need your portfolio to reflect your risk profile as well as your forecast as to what will happen. Since none of us knows for sure what will happen, you won't want to bet the whole portfolio on one stock or one industry. Stay diversified.

Sixth, find stocks that are increasing earnings, even in these terrible times. The best companies always manage to find a way to do that.

Some stock ideas: Abbott Labs (NYSE: ABT), Baxter International (NYSE: BAX), CH Energy Group (NYSE: CHG), Chevron Corp. (NYSE: CVX), Coca Cola Co.(NYSE: KO), Colgate Palmolive (NYSE: CL), General Mills (NYSE: GIS), H.J. Heinz (NYSE: HNZ), Hewlett Packard Co. (NYSE: HPQ), Kraft Foods (NYSE: KFT), Johnson & Johnson (NYSE: JNJ), IBM (NYSE: IBM), Intel (NASDAQ: INTC), McDonald's (NYSE: MCD), Nike (NYSE: NKE), Pfizer (NYSE: PFE), Wells Fargo (NYSE: WFC).

Don't rush out and buy any or all of these. You haven't done any research yet. Besides, there's plenty of time. This stock market has no catalysts in sight that will spark a sustaining rally. Which brings me to the last point: when you decide to buy a stock or several of them, buy only a small amount, then wait for a day or two to add to the position. With the volatility in this market, prices change dramatically, giving patient investors multiple opportunities to buy at lower levels. Don't be in a hurry. There's plenty of time. And with quality names like those above, once you own them, be reluctant to sell. You're getting them on sale.