MISERY LOVES COMPANY.. Happy Campers..are those that did not listen to touting of stocks for weeks, months and defensive posturing on their 'favorite stocks' beause they were in the hole and they needed company as it was dark and depressing being in an abyss alone. The market was on tenterhooks for a long time and those that exited and took profits like we did when we kept on holding up the high p/e valuations to scrutiny and doubt did very well. This group could not read the market technicals or fundamentals or just could not be bothered with that. They didn't do homework these investors (or should we say speculators) wanted a quick hit, to shine with their ideas and hyping for a double, triple or even a home run. They hit into a triple play. a) They went bust themselves b) pulled along more than a few gullible trusting souls into a quagmire of loses c) lost any vestige of credibility and trust every again in the process.
The trouble is that the quick hit mentality tanked the market and Wall Street still hasn't recovered. You see these 'gamblers' on message boards, in newsletters touting 'riches beyond belief' and like other get rich quick schemes, it backfired. Of course there were plenty of winners who took their profits. I closed by last small mutual fund in September (BEFORE the earnings warnings come out, as I would never hold stocks through pre season)and got flack from the folks there as to 'why I was losing confidence'
One a level higher we have the group that were touting a stock and themselves short, the first group didn't do that. They were really bankrupt and were as vandalists just ready to get instant satisfaction from the demise of others. The second group was carefully setting up their shorts while at the same time telling everyone 'this is just a natural correction'.. These were a more savvy and sophisticated group and a bit more difficult to pin them down.
The third group was believing none of this and were going their merry way shorting all the 'stock cycles' throughout the entire 7 month time frame. That is our group. These are probably hard times if you are not or have not been short the market. But we have the most important 3 weeks in front of us. There will be more bankruptcies for companies. We can be going short if there is a need because there are always those that 'wishful thinking' will keep us in upticks. This is not the market we want though, but it might be the one we get. Thank goodness we have all our money on the sidelines so we can go long or short as the trend demands. We might rally on a hope the fed steps in, but the fed can't cure a hemorrhage with a little bandaid and there is nothing the fed can do that will not once again pump up the markets for a brief rally that will culminate once again in short selling.
We will believe a rally when we see it. WE will go long when we see how well the earnings reports are being digested by the market and not the other way around. One day is not a rally, its a very brief remission. If the 'cancer' that this market has become is truly cured it must stand the test of time. Not years, in this case, but give if at least a week or two before throwing GOOD MONEY AFTER BAD. Don't invest in a stock with a p/e ratio above 30.
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