Continue reading How long will the McCain, Obama 9/11 truce hold?

How long will the McCain, Obama 9/11 truce hold? originally appeared on BloggingStocks on Thu, 11 Sep 2008 12:00:00 EST. Please see our terms for use of feeds.

A lot of investors were worried about their portfolios after September 11. Assuming that former Enron CEO Jeff Skilling isn't a complete liar, September 11 is what motivated him to try to dump shares of the company on September 6. Oh wait.

Anyway, for investors, I think the most important thing to think about on September 11 is this: How little 99% of news really matters to the markets, long-term. Think about some of the major events of the past 50 years -- The Vietnam War, the assassination of President Kennedy, September 11. Even the Monica Lewinsky scandal had an effect on treasury bills yield! And of course, investors fretted over September 11.

What effect, long-term, have any of these events had on the stock market? I would argue that the effect has been precisely zero. In his book, Contrarian Investment Strategies, David Dreman shows how most major international crises that sent the markets into tailspins would have been great buying opportunities.

There will be more international crises to come, and market pundits on CNBC will be sure to give their take on how they will affect the market. Maybe they'll recommend some "safe stocks" so you can hunker down and ride out the storm. But before you do anything, ask yourself how will this event affect long-term corporate profits, which, history has shown, are what drive the market long-term.

If you draw a blank, hold the stock and turn off the TV.

9/11 and other things that don't matter to the market originally appeared on BloggingStocks on Tue, 11 Sep 2007 17:00:00 EST. Please see our terms for use of feeds.

Six years ago, Osama Bin Laden killed thousands in the heart of the world's financial capital, hoping to bring capitalism to its knees. He failed miserably.

Not only did the world's financial markets rebound, they rebounded spectacularly. The Dow Jones Industrial Average now is above 13,000, about 40% higher than where it was on September 9, 2001. The tech-heavy Nasdaq Composite Index last traded at more than 2581, more than 50% higher than where it was six years ago. That's the power of American capitalism. In fact, my colleague Zac Bissonnette points out that international crises make good buying opportunities for investors.

9-11 couldn't kill The American Dream. Millions of people come to the United States every year in the hopes of bettering their lives in a country where people who take prudent risks can reap rewards. People figure that with a little hard work and luck they might become the next Bill Gates or Warren Buffett. It's that faith in the future that draws people to the stock market. People say they invest in the stock market to prepare for retirement, but really they are hoping that they can strike it rich, even if it's on a small scale.

There are many stories of heroism from 9-11. Mine isn't one of them. I spent the better part of the day in the New York City bureau of Bloomberg News, which thankfully was far away from the carnage of Ground Zero, trying to figure out how I was going to get out of Manhattan. Somehow, I got on to what I think was one of the first NJ Transit trains that left the city that day much to the relief of my family.

For New Yorkers such as my colleague Valerie Russo, who was a school teacher at the time, the day was even more harrowing. Georges Yared was in London at the time and has an interesting perspective as does Michael Fowlkes, who was working as a stock trader. It is a day that the American people will never and should never forget.

Osama Bin Laden couldn't stop capitalism on September 11 originally appeared on BloggingStocks on Tue, 11 Sep 2007 14:04:00 EST. Please see our terms for use of feeds.