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Shake! Shake! Shake! You Fall Out of the Tree Yet?



November 23, 2011 – Comments (5) | RELATED TICKERS: SPY , GE

A few months ago I was talking to my Great Uncle who had a seat on the CBOE for awhile.  I asked him what he thought of all the volatility in the market.  He said this: "Kirk, the markets work the same over and over, they just do things a little different each time.  The big guys sell as the market gets high, then when they are sitting on cash, they shake the tree until all the little guys fall out.  Once all the little guys are out, the big guys walk around buying things really slow on the cheap.  After awhile the little guy tries to climb the tree again because he sees prices going up and he doesn't want to miss his chance.  When he gets up there in the branches, the big guys shake the tree again and it happens all over again.  That's the way it has always been, that's the way it will always be."

I said, "maybe people will learn someday what's going on."

He said, "it'll never happen."

So, were you climbing the tree a few years ago, then again last year?  Are you buying as prices get cheaper and cheaper, or selling?  Who are you?  What have you learned?

5 Comments – Post Your Own

#1) On November 23, 2011 at 11:17 AM, amassafortune (29.04) wrote:

I try to follow the big money, but it seems these guys get the call when fertilizer is about to be applied. Much of the general public seems to have caught on that the guys surrounded by mahogany are not working in their best interest. 

I did a little buying and covering this AM, but expect to be net short again by Tuesday, post-cyber Mon. There are still a few fall leaves to be blown off the stems.

My tree seemed to be growing to the sky for over two decades, but now I at least wear a harness when I'm up where the swaying and whipsaw is worst.

Thanks for the pithy comments.

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#2) On November 23, 2011 at 11:31 AM, EnigmaDude (50.75) wrote:

I just added shares of AINV now that the big guys have driven the share price down below $7.  At this point in my investing cycle I look for opportunities to buy shares of good long-term investments at a decent price and the recent market drop has created some good buying opportunities.  If I had more cash, I would also add some shares of GE now that it has dropped below $15.  Thanks for posting.

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#3) On November 23, 2011 at 4:10 PM, Option1307 (30.48) wrote:

Patience is key, I was buying in the low 1100's last month and will resume if we get back down to that level again.

Fools need to remember not to chase stocks/markets, set your price point and wait for it to be reached.


Good thoughts per usual, +1.

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#4) On November 24, 2011 at 10:45 AM, kirkydu (90.27) wrote:

agreed, I have limits set on a few things I'd love to own if only they were a bit cheaper.

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#5) On November 30, 2011 at 12:18 AM, HarryCaraysGhost (56.25) wrote:

What's wrong with dollar cost averaging into the stocks you bought at low levels? (div pref.)

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