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The Re-evaluation Process



September 29, 2008 – Comments (5)

As I have stated a few times, my game plan about a year ago was to be out of the market for a year and re-evaluate.

Today Bespoken has a post of data that goes strong to my re-evaluation process. Out of the 20 one day largest drops in the markets 14 of them were between 1929 and 1934.

I tend to think we are closer to 1929 then 1934 in this deleveraging process.  Earlier in the week I did a blog about how the property bubble preceded the "bottom" by 6 years.  Florida's bubble only popped about 3 years ago.

I think today was the first "panic" day, but I don't think it is the last we'll see over the next little while.

I was chatting with a dear friend about this and this friend had been playing the market some, and given how awful it has been, well, my friend is up 4%, which if you are up 4% since the peak last Oct/Nov, well, pat yourself on the back big time.  I am up about 4%, however, the difference here is I've done nothing, no stress, no worries and I haven't been obsessed with checking in constantly to see how the market is doing.

Right now I am leaning towards continuing to watch.

5 Comments – Post Your Own

#1) On September 29, 2008 at 9:11 PM, GS751 (26.71) wrote:

Thanks, it all depends on your stress tolerance, you can make a lot of money in this market, but also lose a lot.  How prepared are you to dedicate yourself to doing research, etc. Can you handle this type of volatility, I dont need to tell u this stuff haha.

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#2) On September 29, 2008 at 9:18 PM, GeneralDemon (26.57) wrote:

Dwot, why didn't you buy some puts???? Do you not know how good you are at stock picking????? Your phone should be ringing off the hook with job offers from Leh, Mer, oops.

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#3) On September 29, 2008 at 10:16 PM, martynanasi (94.24) wrote:

I agree with you  DWOT. Now is still the time to sit on your hands watch the fallout and then pick up some truly unvalued sectors or stocks and watch the weath just roll in. I usually take these opportunies as positive rather then negative. Alot of Icons were made out of the depression era...they were the smart money. We even have historical eventual to show us the way.

i think this is just starting since with the bailout package being rejected we are in for a whole heap of downside. I see the DOW at 7 maybe 6k when this is done. This will get alot worse, alot of people will lose their jobs and alot of stocks will hit the skids. Today was just a reminder that fear and greed are the  two biggest determinations in the market.



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#4) On September 29, 2008 at 10:56 PM, goldminingXpert (28.64) wrote:

I'm up 35% this year. Just buy puts any time the dow goes up 300 points or more in a day. This trading pattern autofades all the BS that causes pops in a bear market.

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#5) On September 29, 2008 at 11:10 PM, dwot (28.84) wrote:

I was planning on staying with some in the market, but the fact that when I tried to move about half my money and they brokerage just didn't comply with the request scared me.  It just didn't seem worth the risk.

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