Key Posts from the first 1500, #12

Investment Analysis Clubs Saul’s Investing Discussions
1

This was post #52 on this board. It was a repost from November 28, when everyone was anxious about the Fed starting to taper, and the pundits were all predicting a vast sell-off when it happened. Brittlerock, in a post addressed to me talking about when to sell, wrote the following:

This plagues (worries) me. I, like you, am retired. I have income other than market, but lately I’ve been getting very uncomfortable. It seems that the Fed’s QE policy is propping up the bull and the moment someone gets a whiff of a policy change it’s going to unravel in a big way.

I responded:

I think that tapering of the QE has been anticipated for so long that it won’t surprise anyone. The market is so expected to go down that it may even go up. It also won’t be tapered until the Fed is sure that the economy is doing well enough.

After all, there’s been job growth for 44 straight months now, with 7.8 million private sector jobs added. And the Deficit is at half the percentage of GDP that it was five years ago, so the economy isn’t as bad off as that. It may actually no longer need all the propping up. Smile. Saul

That’s actually what happened when the Fed tapered in early December, the market went up and kept going up. The lesson is don’t get rattled by the disaster-is-coming headlines that sell papers and columns online. Use your head.

Saul

5 Likes
2

Saul,

As usual what you have written several months ago has proven to be true…again.

You have a rare gift which is simply your common sense and wisdom. Most of us invest way too emotionally because of something we’ve heard on CNBC or fear from headline screaming warnings. Then you calmly walk into the room and pick up a few treasures others have left behind in a panic.

Wisely, you apply a few basic financial guidelines to evaluate stocks and you stick to your guns. Why you sold SODA several months ago, for example.

Finally, your generosity in sharing your decades of experience with us has brought you even greater favor and appreciation from a growing number of Fools.

Count me among those who appreciate your hard work, DD, and wisdom.

May God grant you favor, good health, and longevity.

Jim

9 Likes