Money & Investing - Banks.com

Yesterday, an attempted stock market rally fell to pieces in the afternoon. Today, a feeble attempt to rebound is again falling flat. It is apparent that panic has set in, and everyone is trying to liquidate everything as quickly as possible. Bloomberg reports on the panic stricken stock market:

“What we have is a slow-motion crash,” said Robert Arnott, founder of Pasadena, California-based Research Affiliates LLC, which manages $39 billion. “In the space of 10 days, we’ve had a 25 percent drop — that’s a crash.”

Now is not the time to panic

Despite the craziness that is the stock market breaching the 8,000 mark, it really is not the time to panic. For instance, some of us are bargain hunting today. This is a bit risky, I know, since with the current state of things it’s going to be tricky to find a company that will still be around when all of this is over. But they are out there — and they are cheap.

Additionally, now is a good time to remember that not all investing is in stocks. There are plenty of investments to be made outside the stock market. Cash is one investment (the return stinks, but short-term it’s better than the return you’ll get on stocks), and there are things like commodities (even though all but gold is sinking). The U.S. dollar is doing pretty well right now, mainly because out of all the tanking economies in the world, ours is still probably among the more stable. And we’re further into our crisis, so we are likely to recover first.

At any rate, if you have a long time horizon to retirement, now is the time to strap in. Chances are that you will recover. If you have a short time horizon, maybe now is a good time to re-evaluate and see if you can put of retirement.

Disclaimer: I am not an investment professional. Nothing in this piece or on this Web site should be construed as investment advice. Before making investment decisions, do your own research and/or consult with an investment professional. All investment comes with the risk of loss. You are responsible for your own investment decisions and any loss that may result from your decisions.