The sell-off today accelerated when the FED minutes were released and those minutes just contained more downbeat news, taking the recession well into next year with the downside risk that it will last even longer. Yahoo! Finance Basically, I am going to stop trying to catch the falling knife, but will continue reinvesting dividends to buy additional shares for stocks and funds which I currently have set up for reinvestment. I will not venture back into the market to buy stock or funds until the VIX returns to what I refer to as a stable level. I will continue to monitor my bond positions possibly using cash flow to buy new investment grade bond issues only. I will continue with my blog but the length and frequency of them will change.
Wednesday, November 19, 2008
S & P Falls Below 815: Time to Go Into A Cocoon/Extended State of Hybernation
I mentioned several times that I would stop all buying of common stocks if the S & P 500 average broke 815 (see, e.g., second paragraph of this post: Nikkei Hits 26 Year Low: A Long Term Hold?)This was the low in the prior bear market using monthly closing figures. S & P 500 at 815 was the closing low for September 2002 and it is the number that I previously picked as the trigger to stop all buying. The S & P did fall as low as 768 in October 2002. But for my purposes 815 is close enough to alter my behavior.