is the stock market crashing?

Question

record consumer debt, real estate bubble bursting, easy credit gone, is it Armageddon?

Answer 1

If the stock market falls 5 to 10%, and you feel compelled to sell, don't invest in the stock market. These drops are normal. They happen, specificaly, when the market hits new high. Since a low point in 2002, the Dow has risen over 6,000 points or 80%. You need to have the stomach to ride them out.

If you worry about what the market will do in the next 6 months, you are not investing. You may be gambling.

Focus on earnings more than fluctuations. Corporate earnings drive the stock market. Yes, other influences such as consumer debt, real estate bubble bursting, do impact stock prices, especially over a short period. Focus from daily fluctuations to long term fundamentals.

Answer 2

I don't think the stock market is crashing nor do I think this is Armageddon. Armageddon is a battle which will be fought in the Middle East. I do believe we may be in for some difficult times. People seem to be out of control with their spending. We need to get back to buying what we can afford. I not sure easy credit is a thing of the past. The government will likely pay the banks out of their situation. Those who have good credit may pay a higher premium for those who default. Even during the great Depression of 1929, there were those who did very well. Those are the ones who had cash when the crash occurred. They bought businesses for pennies on the dollar. Your best bet is to get out of debt and save as much money as possible. When the economy takes a down swing, it is those who are too heavily leveraged who seem to hurt the most. If you have little debt and money set aside, you should do just fine. When you have little or no debt you don't need much money to get along.

Answer 3

What you are seeing is the beginning of a major sell off. By late Oct/early Nov. look for the Dow to possibly lose about 20% from it's July high, ie, land around 11,200.

But this should not be seen as a "correction". The market will probably place in a minor bottom and rally, but this will most likely be a counter-trend. I believe we are seeing the beginnings of a secular bear market that will last till around the year 2022 or 2024 and take the Dow back down into the 1000 point range. As of now, look for the Dow to rally to around 13,500 till around mid-Sept. If that happens and the Dow rolls over again, look for a quick and violent sell off into late Oct./early Nov.

Again, if that happens, then what we're seeing is the beginnings of a very brutal bear market that will last for many years.

Answer 4

No, if it were crashing most securities would be worth very little and we would be in a recession or depression. and that isnt happening because the economy is still growing. The stock market maybe overreacting to a big fear right now(sub-prime mortgages) or the market could be going through a correction.
Our dollar is weaking, and our economy isnt what it used to. But thats because we are going to war, buying foreign products (your clothes, cars, oil) and making everybody on earth hate us( because we are rich) Thank your grandparents( the ww2 generation) for enabling us to be the world superpower, but dont thank your parents for blowing all of that for greed and materialism. (sorry for ranting)

Answer 5

if you don't sleep well at night ... sell out.


the market is going to do whatever it dang well wants to do.

your job is to manage your situation no matter what the market does.

stop trying to predict the market -- it can't be done with enough reliability to make an extra profit.

or it already would have been done and the extra profit would have disappeared already.


:-)

[added for wanna.... while our economy isn't what it used to be, the reasons you cite have little or nothing to do with it. I posted on other threads about the real reasons. :-) ]