Overcoming Your Feelings in the Economy

Why you need to overcome you feelings in this economy...

The American economy is not going anywhere. We are, and will remain, the world's economic leader. When the American market stumbles, the foreign markets follow. The essential understanding you need to have is that the market is going to rebound and rebound fast. Right now, poor decisions on the part of government and business have caused the banking industry to crash. Now, also as a result of government, unions, and poor business practice, the Big Three American automotive companies are in danger. These are serious issues that should instill real concern in every American. However, American's still need mortgages and still need cars. Therefore, the market will eventually stabilize. Remember the disastrous effects of September 11, 2001 on the economy? The airlines have learned to adjust and the economy reached new heights.

The question for you is...will you take of advantage of the current market economy? Warren Buffet has recently invested 100% of his wealth into the economy. Why? Because he understands the market will return and he enjoys making money. In the past months, I have lost 50% of my savings that are invested in mutual funds. This amounts to thousand of dollars! My reaction, transfer every last penny I have to spare into the mutual fund accounts. This is why... Before the economic downturn, the value per share I own was about $50. Now, the value is $21. First, I have absolutely no doubt the price per share will not only go back up to $50, but will far exceed it. Consequently, I stand to make a lot of money the more shares I purchase at the current low price. For example, if I buy 500 shares at a total cost to me of $12,500 ($25 x 500), then the value of those 500 shares will be $25,000 when the price reaches $50 and $37,500 when the price reaches $75 per share. Ric Edelman, CEO of one of the nation’s top financial advising companies, pointed out recently on his weekly radio show on 630 WMAL, that the market usually rebounds 30% very quickly once it has bottomed-out. This means I could potentially see my $37,500 in just one year.

Certainly, you should never invest money that you don’t have. But this economy has produced a once in a lifetime buying opportunity. Now is not the time to sell. If you are selling now due to fear of the economy, then you are selling low. This violates the principle of buying low and selling high. If you are waiting for the market to rebound, trouble. By the time you realize the rebound is occurring, you will be buying high. If you are unsure how to start, contact a local financial investor and get help. Don’t miss out! By the way, are you maxing out your 403b and 403k account contributions?

Thoughtfully submitted by Bryan Johnson