Market Update 3-20-09 & Your Weekend Reading Assignments

By Neal@Wealth Pilgrim on Mar 19, 2009 in Money Stress

clownLast week, the market staged its third-largest weekly gain since WWII.   Are we still in a bear market?  Are we in a bull market? Sometimes it feels like we are at the circus doesn’t it?

Has the market ever been so volatile?

It sure has. In fact, from 1929 through 1933, the DOW moved up or down by 20% or more no fewer than 12 times! Last week could just be another head fake.  Of course I’m delighted that the market staged a healthy bounce and I hope it continues. But I’m not convinced its time to throw caution to the wind just yet.

So what can you conclude by recent stock market action? Not much. At this point, I believe its more valuable to revisit your investment objectives and remain focused on the next 10 years – even if you are currently taking withdrawals out of your accounts.  Whatever is going to happen in the market over the next 2 months or 2 years is unknowable. Don’t even try to guess.

HOMEWORK

I’ve come across some fantastic articles over the week and I’d like to share them with you.

First, over at Oblivious Investor I found a great article that explains why the market is unpredictable.  A great reminder.

David, over at Moneyning wrote a very interesting piece on David Back and the Latte Factor.  I like this one because he discusses the real way to become rich. (Hint – it has nothing to do with coffee.)

MyTwoDollars.com had a nice idea – take a vaction for free by trading homes. He goes into the details and I think its well worth the read.

FrugalDad.com wrote a wonderful piece on complacency and its negative impact on our financial future.  I loved this one.

And for all the engieers, Moolanomy featured a nice post on market correlation and diversification. (No offence….some of my closest friends are engineers.)

Wishing you a wonderful weekend.   But I will be giving you a pop quiz on Monday so make sure you do your reading!

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  1. 1 Comment(s)

  2. By Frugal Dad on Mar 20, 2009 | Reply

    Neal, thanks for mentioning my post to your readers. Complacency is one of those things that just kind of creeps up on you over time, and it can be a real drain on your finances. Time to tighten the belt again!

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