MasterPo says: This blog is about topics and issues that are of importance to me. I am not one of the countless blogging lemmings that are tripping over each other scurrying down the hill and off the cliff of blogging oblivion trying to write the greatest blog on the latest topic de'jour. Your comments are welcome.

January 27, 2010

Investing For The Ups and Downs

This isn't going to be another typical 'How To Invest' article you find on thousands of blogs. So if you're looking for easy investing ideas or Garzarelli level predictions, stop reading now.

The stock market will go up.
The stock market will go down.
Which stocks and when is the only question.

It would be an understatement that investing has been a gut-wrenching roller coaster the last 24 months (as of writing this). And MasterPo fears we haven't seen the last of it. Not by a long shot.
But while what direction things will go and when it will happen is foggy at best, the issue of whether or not to invest is clear. It comes down to a very simple question.

Which would bother you more:

Being in the market when it goes down 20%?
Or not being in the market when it goes up 20%?

The great industrialist JP Morgan (we need more people like that to save America! But MasterPo digresses…) is quoted as once saying "If your investments don't let you sleep at night then you're in the wrong investments."

There is always a good reason for not investing. At any time in the last 100 years you could find someone of [supposedly] noteworthiness claiming the end is at hand. Or, someone of [supposedly] great economic insight claiming this it's different because of this or that.

On the whole they have been wrong. Sure the market went down, perhaps took some time to recoup and start back into the black.

But who knows. Call the end of the world often enough and someday you will be right if for no other reason than simply by the laws of probability.

What MasterPo does know is that just keeping your money in a bank saving account at 1% or so, or perhaps locking it up for 5 years at 2.5% or so, just won't do it. You always need cash. That's a fact of life. But as a longer term strategy, taxes and inflation will eat you alive!

Only you can decided when to invest, how much and where for yourself. The "experts" on TV and radio should come with a warning label "For Entertainment Purposes Only!"

Fortune favors the bold!

Just be well informed.

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