Dow Jones, NASDAQ, S&P 500 finish week up overall

Minstrel · Oct 18, 2008

NEW YORK - Wall Street closed Friday’s seesaw session with a sharp loss as strains in the credit markets showed signs of easing and investors sought bargains among stocks that were pounded lower in sell-offs earlier in the week. The Dow Jones industrials still ended a disastrous three-week losing streak with their best weekly gain in five and a half years.

For the week, the Dow unofficially gained 4.75 percent, while the S&P 500 unofficially rose 4.6 percent. It was the S&P's best week since February. The Nasdaq unofficially advanced 4.1 percent for the week — its best week since early August.

The market was uneasy, swinging between large gains and big losses, after the government said new home construction dropped by more than expected last month to the slowest pace since early 1991. But investors’ mood seemed to pick up briefly as lending rates for bank-to-bank loans eased, indicating some bank fears about not being repaid by borrowers is easing. Demand for safe-haven investments like Treasury bills also decreased.
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http://www.msnbc.msn.com/id/3683270/

maxiep · Oct 18, 2008

The past few weeks have shown investor irrationality at its worst. If people didn't need their money immediately and bailed from the market, they're idiots.

Minstrel · Oct 18, 2008

maxiep said: ↑

The past few weeks have shown investor irrationality at its worst. If people didn't need their money immediately and bailed from the market, they're idiots.
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I agree. Short of the market collapsing completely (or the specific companies you've invested in going bankrupt), "losses" are only on paper and only become realized if you sell.

Minstrel · Oct 19, 2008

Great article by Warren Buffet in the New York Times.

THE financial world is a mess, both in the United States and abroad. Its problems, moreover, have been leaking into the general economy, and the leaks are now turning into a gusher. In the near term, unemployment will rise, business activity will falter and headlines will continue to be scary.

So ... I’ve been buying American stocks. This is my personal account I’m talking about, in which I previously owned nothing but United States government bonds. (This description leaves aside my Berkshire Hathaway holdings, which are all committed to philanthropy.) If prices keep looking attractive, my non-Berkshire net worth will soon be 100 percent in United States equities.

Why?

A simple rule dictates my buying: Be fearful when others are greedy, and be greedy when others are fearful. And most certainly, fear is now widespread, gripping even seasoned investors. To be sure, investors are right to be wary of highly leveraged entities or businesses in weak competitive positions. But fears regarding the long-term prosperity of the nation’s many sound companies make no sense. These businesses will indeed suffer earnings hiccups, as they always have. But most major companies will be setting new profit records 5, 10 and 20 years from now.

Let me be clear on one point: I can’t predict the short-term movements of the stock market. I haven’t the faintest idea as to whether stocks will be higher or lower a month — or a year — from now. What is likely, however, is that the market will move higher, perhaps substantially so, well before either sentiment or the economy turns up. So if you wait for the robins, spring will be over.
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http://www.nytimes.com/2008/10/17/opinion/17buffett.html

Shapecity · Oct 19, 2008

The market has been a day traders dream. It's a great article and Buffet is right, now is the time to buy. I've been day trading Visa (V) and RIMM the last couple of weeks and I've taken a position on the telecomm stocks. They pay a nice dividend.

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Dow Jones, NASDAQ, S&P 500 finish week up overall

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Dow Jones, NASDAQ, S&P 500 finish week up overall

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