I'm not going to ignore the deterioration in a stock. |
I'm not sure that I would agree this is a real bear market -- there are some important missing pieces. |
I'm overweighting energy, |
I'm referred to as a fundamentalist -- a person who cares about company earnings and where the economy is going -- but the truth is I'm a closet technician. I've learned something as we've moved through the bear market: The last people to find out about a problem are research analysts and fundamentally oriented strategists. |
If I thought Cisco was going to grow 40 percent for one year, I would never pay two-plus the growth rate. But if I thought it was going to be a five-year deal, I would. |
If the Fed raises rates three times, they're not doing it just to have fun. Life is good. |
If there are lots of other signals of appending recession, take it seriously. But don't hang your hat on the yield curve. |
If there's no bounce, it's investors saying that the market has not reached a level that accurately reflects what's ahead for the economy and earnings. |
If you get that configuration, particularly liquidity conditions, usually you can bet pretty heavily that this is going to be a bull market, |
If you get that configuration, particularly liquidity conditions, usually you can bet pretty heavily that this is going to be a bull market. |
If you separate out all the sectors of the market, it's no longer the case that technology is the most overvalued sector of the market, health care and energy actually carry higher valuations than technology now. So we are starting to get the levels overall in technology that really make some sense. And interestingly enough, if you take it even further, if you go to the individual stocks, stocks like Sun, Cisco, Texas Instruments, Oracle -- great names, they're starting to get to levels which, again, don't call them cheap, but call them cheaper and interesting, |
If you're an aggressive investor and can't sleep at night, then you should defend your portfolio by raising some cash and shifting into more defensive stocks, |
If you're going to bet on economists and strategists on one hand, and the markets on the other, take the markets every time. |
If you're not a day trader, I would say don't do a thing. If you're buying for the long term, you'll be just fine. |
Individuals are buying stock with the idea that it will become even more overvalued. That's a sign of speculation. |