On days like today, with the market looking as bad as it is (currently down over 4%), there's not much that I or anyone else can say other than this is painful. The most frustrating part of investing, is that sometimes there are simply no explanations for why the stock market goes down like it is today. What generally happens, and what is happening today, is that when the market starts to fall like it is, more and more people sell because they can't stand to see their stocks/mutual funds go down as much as they are...it really becomes an emotional thing - because after all we are dealing with and talking about real money. In managing peoples money, or even managing your own, the toughest part is knowing when to buy or sell. No one, not even the smartest money managers in the world, can time the stock market. So, in order to survive in an enviroment such as the one we are in today, you have to stick to the fundamental principles of investing. These principles, as I've mentioned before, are to do the research, find undervalued stocks or find stocks that are "special situation" stocks (this would be like Etrade or Yahoo which will both eventually be bought by another company).
Now I'm sure people have heard the old saying "throw the baby out with the bath water"...well that's exactly what's happening today. For example, gold, which is usually viewed as a "safe haven" and something to buy when things are bad, is even down today (WHEN IT PROBABLY SHOULD BE UP!).
So I'm basically saying, as the evening news will talk about, the market is ugly today...but remember days like today happen, they always have and they always will. But remember, the sun will come out tomorrow, and at some point the market will go up again...and as I've said before, cash is an extremely important investment, because eventually it'll be time to start buying stocks off the sales rack.
In the meantime, sit on your hands, because there's not much that can be done...
I'll write again later with something more upbeat and positive
