Yielding Wealth | Personal Finance

The Wild Ride That is the Stock Market

by miranda on November 1st, 2007

ExxonMobile (XOM) ran into earnings trouble and that, coupled with ridiculously high oil prices, has managed to effectively undo any positive effect that might have come with yesterday’s Fed rate cut. Of course, the biggest damage was probably done by the statement accompanying the Fed rate cut. The implication is that the slashing is done for now. MarketWatch reports on this, plus trepidation over tomorrow’s payroll numbers:

“The morning after [a Fed announcement] tends to be a rough ride,” said Art Hogan, chief market strategist at Jefferies & Co. “As we start to get concerned about the non-farm payroll number on Friday, the reality that the Fed might be done cutting rates is setting in.”

So, for those of us that can’t really stomach a ton of risk, this stock market stuff is scary. But the good news is this: over time the stock market usually rises. So if you have a long-term buying strategy (think: retirement accounts), this might not be a bad thing. It’s a good time to buy a few solid stocks with growth potential for lower prices.

No time is the old stock market adage “Buy low, sell high” more true than it is today, amidst all the economic uncertainty. The trick is discovering the difference between basement bargain stocks and stocks that are just basement.

Disclaimer: I am not an investment professional. I am an enthusiastic amateur. Do your own research and/or consult with an investment professional before making any asset allocations or making any investment.

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POSTED IN: Investing