1.) See my market post below. Simply from a technical perspective the market has already sold-off a ton. While it can still go lower I think the majority of the technical damage has been done.
2.) We have seen unprecedented international action to thwart the credit crisis. Europe as swept in with a massive package. The US followed suit. Now there is talk of an international conference to deal with this situation. The bottom line is governments are reacting with appropriate concern and giving an appropriate response to the problem.
3.) Barry's bullish. If you thought I was bearish, well you don't know Barry. Actually, I think we were both bearish for quite some time. Barry's a big fan of contrary indicators. And he's seeing a lot of them right now.
4.) Consider the following from Warren Buffet:
THE financial world is a mess, both in the United States and abroad. Its problems, moreover, have been leaking into the general economy, and the leaks are now turning into a gusher. In the near term, unemployment will rise, business activity will falter and headlines will continue to be scary.
So ... I’ve been buying American stocks. This is my personal account I’m talking about, in which I previously owned nothing but United States government bonds. (This description leaves aside my Berkshire Hathaway holdings, which are all committed to philanthropy.) If prices keep looking attractive, my non-Berkshire net worth will soon be 100 percent in United States equities.
Why?
A simple rule dictates my buying: Be fearful when others are greedy, and be greedy when others are fearful. And most certainly, fear is now widespread, gripping even seasoned investors. To be sure, investors are right to be wary of highly leveraged entities or businesses in weak competitive positions. But fears regarding the long-term prosperity of the nation’s many sound companies make no sense. These businesses will indeed suffer earnings hiccups, as they always have. But most major companies will be setting new profit records 5, 10 and 20 years from now.
Let me be clear on one point: I can’t predict the short-term movements of the stock market. I haven’t the faintest idea as to whether stocks will be higher or lower a month — or a year — from now. What is likely, however, is that the market will move higher, perhaps substantially so, well before either sentiment or the economy turns up. So if you wait for the robins, spring will be over.
For me, the most important indicator right now is a raw, long-term chart of the SPYs. Bottom line, that looks like one hell of a buying opportunity to me right now.
