October 17, 2008
The Great American Recession is underway Is it a Myth or a fact?
Almost every investor and broker is screaming recession over the top of their lungs. The indicators were obvious when stock markets collapsed on Monday. The deepening concerns that government intervention would not be enough to pull barriers in front of the mighty global recession is been voiced over many forums including big news networks. I personally think that even if there is any chance to avoid the recession, our investors and real estate professionals won’t let that happen!
According to Marc Pado, stock market strategist at Cantor Fitzgerald says, “Recession is unavoidable at this point, now it’s just a matter of depth.”
Despite all those fearful figures, the government bailout will help recede the recession. It’s only a matter of time. Right now, it seems that speculations are creating fear among investors. According to an article at latimes, “Despite the $700-billion bailout bill enacted last week, the Dow Jones industrial average plummeted 800 points, or 7.7%, before rebounding to close down nearly 370 points. The blue-chip barometer fell below the 10,000 level for the first time in four years. Stock markets in Europe plunged as much as 9% after a series of hastily arranged bank rescues there over the weekend. “
The whole figures mumbo jumbo is in fact widening the recession and creating fear among people. However it is true that U.S is going to be hit with the worst recession in its history mainly due to the credit crunch. The topping is provided by the rumors, speculations that have the proven power to scare people off.
My opinion is a bit different than others. Although Warren Buffett, Billionaire investor said on Monday the U.S. economy is in recession and that stocks are "not cheap" despite recent declines which means that it’s time to wake up and get started on the rebuilding process. If all investors in our country join hands to stop the recession, it will definitely put a dent. But as you can see investors are voicing their deepest concerns to the point that common man is ready to take out all his/her money from the bank to keep it in the house until the recession recedes. Sam Stovall, chief investment strategist at Standard& Poor’s Equity Research has rationality in this chaos. He says, “In terms of the menagerie of investor emotions, we’ve already gone through anxiety, despair, panic and capitulation. Now we’re wrestling with despondency.”
However, there are a few ‘rookies’ who want to dissipate all the speculation and starting buying process. In fact, there are quite a handful of investors trying out to do business despite the fact that recession can hit us anytime – partly due to the credit crunch and mainly due to speculations and fears.
Nathaniel Sheetz, a 24 year old professional is in a buying mood Monday despite the fact that he doesn’t has decades of investing experience.
Bottom line is that recession is coming, but for some people it’s a golden time to make a bunch of money. In contrast, people who fear the recession are sitting and watching the whole affair unlike those intelligent beings who have decided to invest and earn without any fears of recession. As they say, “Opportunity favors the brave”
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