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Stock Market Woes - How does one take advantage?

Posted by Chas2002 • 6/07/08 • Subscribe to this Discussion [RSS] • Report This Topic
Topics: stocks

To quote: "Stocks will enter the second week of June with renewed uncertainty about the outlook for the ailing U. S. economy, after shocking news that the U. S. jobless rate jumped to 5. 5% while crude prices soared to a record near $140 a barrel."

I've been teetering on investing in the stock market for several months now. I was watching Mad Money for a couple of months and about to go with some of the suggestions from Jim Cramer – then – he made a big blunder, so that, of course, reduced my confidence in him.

Do you invest? If so, what stocks are good counters to a slowing economy?

User Comments

6/07/08

wehireu

It is called shorting and patience.

[reply]
6/07/08

richrf

Right now, I am all in cash. I don't invest in a contracting world economy and one where there is a chance for massive inflation. It reminds me a lot like the 1970s. The market basically has gone no where in 10 years. And forget about Cramer and his ranting.

However, if you want a suggested portfolio, that will sort of go up and down with the ebb and flow of money throughout the world, I can give you one. It is basically spreading money among many asset classes using EFTs.

If you want to short, then make sure you have a stomach of iron. You will be fighting against the tide, which means you have a good chance to make lots of money, if the markets tank, but you will also have to deal with lots of volatility, which will be difficult to respond to in an international marketplace.

Hope this helps,

Rich

[reply]
6/07/08

witewood

It's like catching the falling knife.

[reply]
6/07/08

saraho

Follow the long term themes....short the US dollar, long energy, metals, and commodities. Watch silver.

[reply]
1. 6/07/08
  
  richrf
  
  I consider these more short term, bubble type of themes, that work as long as you get out before the bubble bursts. Yesterday's action was mostly caused by the European banks signaling that they may raise rates to fight inflation, thereby attacking the dollar. Also, there were lots of institutions that were shorting commodities, that had to get out in a hurry.
  
  This situation will stay this way, until the Feds start raising rates again. The market doesn't think they can as long as the economy is a funk and jobs data is poor - but if they felt they had to raise rates to fight inflation, they will, and the bubble crash just like all bubbles have.
  
  Commodities are a speculation, and I would not do it, once the bubble is forming. When it bursts, it really bursts must like the Internet and Housing bubbles, and speculators will get fried. It happens very, very fast.