Thursday, March 26, 2009
No more waiting on the stock market; Bear rally is an illusion; Wall Street will be no dependable place to put your money for years, not months
I thought I could wait out the stock market's volatility to get back in this year after getting out last summer.
Despite the impressive and ongoing Bear market rally, it is becoming increasingly apparent that the stock market will not be the place to put one's money for somewhat safe harbor and good return for years, not months.
And while impressive in it structure, the Obama administration's toxic assets plan is only going to corrode the pocketbooks of taxpayers in what will become the most spectacular fiscal policy disaster in this nation's history.
Instruments outside of equities and commodities are the only place to go for security and a decent return. And that will require extensive individual research.
Stock brokers and financial advisers -- who are suffering economically from all the money on the sidelines -- are going to push you into instruments from which they'll receive a fee or commission. Don't depend on them to give you the right guidance.
And depending on the stock market to finally decide its direction is reckless.
Despite today's finalized Commerce Department determination that the GDP declined in the fourth quarter by 6.3 percent and mounting initial jobless claims filed, the market is up. That's representative of an institution out of control. And the only direction for it over the long term will be down.
AP reported these staggering figures: The total number of people claiming benefits jumped to 5.56 million, worse than economists' projections of 5.48 million, a ninth straight record and the highest total on records dating back to 1967.
I see no reason for the markets to be up, except that an insanity for new hope has taken hold. Wishing for recovery is not going to make it happen.
Marketwatch.com says that economists predict a similar decline for the GDP in the first quarter. Some economists are predicting even worse.
Economist Nouriel Roubini, who predicted the Great Recession, sees the Dow back down to 5,000 and home prices declining another whopping 20 percent.
He has yet to be proven wrong. Getting back into the stock market is now something off my radar for years, not months.