DOW 5,000...???

basically you sell stocks that you don't own...  you just have to hope that the stock price keeps going down so you can essentially then buy the stocks at a price lower than what you sold them for...  kind of like playing the "don't come" line in craps out in vegas...   

I'm no stock expert, to say the least.  But I figure, the lower the market goes, the more I should put aside to invest.

I'm only 39, and at least 30 years from officially retiring.  I'm pretty sure the market will turnaround before then.  

Yeah, those guys I feel sorry for.  Although I wonder how many of them should have had much money in the market at their age? Everything I've read about investing says that the stock market is more for long-ish term investments, and that the closer you get to retirement, the more money you should move out into more stable investments.

That said, I have a friend who was planning on retiring in two years, and now she's had to push that back.  But she still has a job, so that's something.

Actually,

If anyone does have some money right now and won't need it (can keep it tied up in stocks) for the next 10-15 years ... now is the ABSOLUTE, BEST time ever to be buying up stocks and mutual funds.  This is how the rich really get wealthy.

Just do your homework and research and buy in companies that have a better than average chance of rebounding.  One basic rule to follow (and of course you may miss out on the biggest gainers like Microsoft, Cisco, etc ...) but a safe golden rule is to invest in the blue chip companies ..

Those that have been around a while and will most likely survive no matter what .. like AT&T, IBM, Ford, Coke, Proctor and Gamble, etc ... these companies since they are so large and diversified ... will almost always survive these recessions and in 10-15 years will rebound .... if you could snatch up so $10,000 of IBM stock ... and let's say they are in a 10 year low or something ... odds are in 10-15 years from now ... that $10,000 of IBM stock will be worth multiples more ...

Problem is, I've spent so much money and have stretched my budget so far just to survive in these times that I don't have any money to invest.

But for those who do have money ... I'd go so far as to say that it is their Patriotic Duty to start buying up as much cheap stock as they can ... that is the only way these companies will get the cash they need and to rebound and that will help pull us out of this economy.

When recession hits, it is the responsibliity of the Rich to buy, buy, buy and invest all they can to pull the economy back up.

not sure i agree with that...  i dont think that the market has had an up month since august of last year...  and i dont think we'll see one for a while yet...  i'm all for buying low...  but i would be pretty content with sitting on cash for the time being...  better yet...  pay off your mortgage or any other debt you may have...  its like locking in 5% return (assuming that is what your mortgage is that)...  which seems pretty attractive in this market...  i would think that once you see corporate earnings turn a bit... it may be time to get back in the market in a bigger way...

I actually think you can get some better returns in the debt markets right now...  look at the returns on some of the corporate bonds out there right now...  there like strong equity returns...  and you're in a more senior position on the balance sheet if the company falters...  

please note that this is just my amateur 2 cents....

The "worst thing"..?!?  REALLY...???

This has been an ongoing debate in my office...  I agree with your thoughts on inflation...  and of course it would make sense to take as much 5% money as you can get if you know that you can get 10, 15 or 20% on it...  but thats a big "if" as to whether inflation goes that high...  and i would guess that its going to be 2 - 3 years out anyway...  i used to take the same position as you on this...  but looking whats going on in the economy now i've changed my thinking on it...  i guess one of my premises is that people generally arent good at sitting on cash...  if they have it... they spend it...  so i've always viewed paying off your house as kind of a forced savings...   anyway...  i just used the 5% mortgage as an example...  i'm sure a lot of people also are sitting on 15% - 20% credit card debt as well... 

my other premise is that most people are over levered anyway...  which has contributed to the situation we are in right now...

regardless...  and obviously hindsight is 20/20, but i'm betting a lot of people that have watched their investment portfolios cut in half over the past 6 months wish they would have pulled the money out 6 months ago and paid off their mortgages... 

I look at paying off my mortgage like this: I no longer have a $700/month payment.  That's $8400/year I would have available for whatever.  I would be shocked (and thrilled!) if MMK accounts got back up to 3 or 4% any time soon.  I hope so, though, b/c our emergency fund and misc savings are stashed in one and it pays interest monthly, so 3-4% would be nice, again.  [rant]And please do not give me the line about being able to use mortgage interest as a tax deduction - it's not enough for me to want to keep paying $8400/year for it.  I'll invest my yearly total P&I and make my tax deduction back in interest.[/rant]

My post about this being the best time to invest in stocks and mutual funds (and yes bond funds if that makes more sense) ... is based on the fact that someone can leave that money invested for 10-15 years .... it will increase in value in that time frame and the investments will be worth more in 10-15 years .... if you buy the blue chip stocks.

As far as paying off your mortgage ... there are 2 ways to debate this.  If you have the money to pay it off then by all means do so ... but I doubt most people have that much cash lying around.

The biggest debate you usually hear is about making that extra principal payment every so often  ... but the logic is that if your interest rate is like 8% or lower then you would be better off investing that extra money on stocks or funds that will most likely earn more than 8%.

So if you only have the money to make an extra mortgage payment every few months and you have a 7% of 6% interest rate ... you might be better off buying some stocks or funds that will most likely earn 8-10% or more over the next several years.

Pay off your high interest rate debts (like credit cards), keep the low interest rate debts (like your mortgage) .... the only downside is that most people won't be discplined enough to take that extra mortgage payment money and instead use it to buy investments ... they end up spending it on something else.

X2, there is no inspiration for any rally in the near future, I think we are going to see a complete shakedown of coporate America and its to be ugly. I thought with oil prices going down it would give consumers some breathing room, up until oil companies had to muffle refining production and drive prices back up. Every day its something else, look at what GE just did !

Aw come on guys Uncle Obama says it's a good time to buy stocks.  I'm gonna sink all my money into the stock market cause Uncle Obama will give me more.

Sorry I just read the new housing plan loan modification guidelines and I think I just need  a to drink the Kool Aid or I will be sick.

Uncle Warren agrees with Uncle Obama.

Uncle Warrens got a whole lot more money than I do and can risk more.

I'm waiting for all the blue chips to become penny stocks,$5.00 should get me a nice portfolio.