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Serious Money: Optimistic Economic View

Sheldon Liber — Mon, 29 Mar 2010 11:30:00 EST

Filed under: Google (GOOG), Microsoft (MSFT), Apple Inc (AAPL), Cisco Systems (CSCO), General Motors (GM), Berkshire Hathaway (BRK.A), Citigroup Inc. (C), Johnson and Johnson (JNJ), JPMorgan Chase (JPM), Bank of America (BAC), Economic Data, Wells Fargo (WFC), Serious Money, Financial Crisis

The negativity in the market place has been palpable for several years and is only thawing out now, in some people's view, while others rant about a "double-dip" or "W-shaped" recovery. In contrast to those who shun the market, I have been buying stocks at bargain basement prices over the past year with a return on investment that is "staggering," to quote a Wells Fargo Financial Consultant familiar with my account.

I am well aware that the record deficit spending in the United States is even more staggering. Everyone knows about the high unemployment rate, foreclosure rate, bank failure rate, and tepid consumer confidence. So why am I so optimistic about the economic recovery? Here's why, as simply as I can state the case:

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Serious Money: Optimistic Economic View originally appeared on BloggingStocks on Mon, 29 Mar 2010 11:30:00 EST. Please see our terms for use of feeds.

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Did we reach bottom? Nostradamus has been punked!

Sheldon Liber — Mon, 06 Apr 2009 12:30:00 EST

Filed under: Major Movement, International Markets, Other Issues, Good news, Rants and Raves, Market Matters, Money and Finance Today, DJIA, Recession

The market has been flying high with the DJIA reaching a milestone closing at 8,017.59 last Friday, April 3. However, the euphoria should not be taken as an all-clear sign to jump in with both feet. I do believe we have reached an inflection point, but volatility still rules the market and the world economy.

A few weeks ago, on March 9, when the DJIA closed at 6,547.05 I suggested the market had reached bottom. It now looks like that is a real possibility. My rationale was straightforward. The point of maximum fear and capitulation -- "The world is coming to an end!"

If you were out of the market from March 9 though April 3 you missed a gain over this period of 22%. Students of market history might remember that 90% of the growth in the DJIA has occured on 7% of the days. I do not mean to suggest that the money you need to live on should be left in the stock market at risk during these troubled times. You do need to set that aside in cash or a diverse pool of financial instruments.

If, on the other hand, you are investing for your long-term needs and you pulled everything out at what might have been a low point, you might have just blown it. Therefore, you might consider returning to the market gradually. If we see our currency diluted, do you really want to be in all cash or treasuries? See: From gold standard to no standard: 'Lightspeed inflation'

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I am pleased to say that I have been buying stocks through the quarter at what I considered bargain prices while also cashing in on the palpable fear and negativity I perceived by doing naked puts.

On March 11, two days after thinking we'd hit bottom, I went even further posting Is the stock market spring loaded? Could it move 3,000 points higher now? -- do you think there could be another 1,500 points left in this push upward?

Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm. He writes the columns Chasing Value and Serious Money.

Did we reach bottom? Nostradamus has been punked! originally appeared on BloggingStocks on Mon, 06 Apr 2009 12:30:00 EST. Please see our terms for use of feeds.

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Nostradamus was a punk! Have we reached bottom?

Sheldon Liber — Mon, 09 Mar 2009 14:10:00 EST

Filed under: Forecasts, Good news, Rants and Raves, Apple Inc (AAPL), Cisco Systems (CSCO), General Electric (GE), Stocks to Buy, Intuitive Surgical Inc (ISRG), Recession, American Eagle Outfitters (AEO)

If there is anything that makes me think we could be close to a market bottom, it is all the people that have gone off the deep end thinking the world may be coming to an end.

For the time being highly leveraged debt obligations seem to have come to an end. Large independent investment banks may have come to an end for now. The idea of a balanced budget may have come to an end a long time ago. However, the world is not coming to an end.

If anybody out there thinks that the times we live in come close to the Dark Ages, the American Revolution, the Civil War, World Wars I or II, or the Great Depression, then they are wimps who know nothing about history or true misery.

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Nostradamus was a punk! Have we reached bottom? originally appeared on BloggingStocks on Mon, 09 Mar 2009 14:10:00 EST. Please see our terms for use of feeds.

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