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young investor...Questions and opinion Where Will the Market Go after March 1

Discussion in 'BBS Hangout: Debate & Discussion' started by eddiewinslow, Feb 20, 2013.

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  1. eddiewinslow

    eddiewinslow Member

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    I know all about the sell in May and go away, but Im really starting to worry about the market right now. Granted I don't have millions in the market, I still do have a big chunk in some dividend titans: coke,exxon,etc.....Im not the most tenured investor Im in my mid 20's and Im a buy and hold investor who wants to build dividends over time so a short term decline doesnt worry me, but what does is....

    1.Why are gold and silver dropping as we print more and more money?
    2.Is the Market rallying bc of a new influx of investors? People in my family are conservative indians who are wealthy but never bought stocks and now all my uncles talk about is the stock market and how they put money in bc their banks were giving no returns
    3.With future inflation, the market rises with it correct? ie better to have coke stock than a dollar losing value?
    4.How is everything rising when
    a.sequester is around the corner
    b.higher gas prices
    c.GDP was lower last quarter and will be again this quarter
    d.higher taxes for all
    e.2% payroll increase hurting lower income earners spending power

    Im just a kid, but Im so so confused at what Im seeing and how to invest....do I wait for a pullback(soon?) and add to my long term buy and hold positions or do I just keep on like I have been adding every 3 months even though all 10 of my stocks are at yearly highs and honestly besides exxon whose unreal at 10x....coke,pepsi,walmart etc are all 15x earnings and still great deals.....so, seasoned investors....enlighten me please
     
    #1 eddiewinslow, Feb 20, 2013
  2. larsv8

    larsv8 Contributing Member

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    Supply and demand. If the price is down, people aren't demanding it, thus, despite the creation of money, investors still have faith in the dollar. Inflation is coming though and if gold and silver are down down, seems like a great long term investment now.

    Banks do give little to no interest, so the market is usually a better place for capital in the long term, however the "market" is more than just stocks. I question your family's strategy of putting money in now though, because this feels like a peak to me.

    In my opinion, the government debt and dollar bubble will probably burst in the next 2-4 years which will have a catastrophic effect on the market, so unless your financial instruments are inflation and interest rate protected, odds are they will lose alot of value.

    Honestly the best things to own during times of inflation are personal debt because you are paying back fixed debt in inflated dollors and also interests in exporters, because inflation means cheaper US goods (to foreigners) and more exports.

    There is really nothing good about inflation. It will cause higher costs for companies and less profits.

    Because the market is based on speculation and people see the market going up and want to jump on board. Savy investors are likely pulling out.

    You could ask this question 10 times and get 10 different answers.

    I personally, am scared to death of the market right now.
     
    #2 larsv8, Feb 20, 2013
  3. eddiewinslow

    eddiewinslow Member

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    thanks for the input! I know the long term trend is up....just wanted to know if i should keep adding what i add every 3 months at all time peaks, or just wait for a slight correction before i do.....I dont like to buy any stock at 15x earnings....and coke right now is at 19x i think maybe 17x
     
    #3 eddiewinslow, Feb 20, 2013
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