Manic-Depressive Markets

Yesterday's 10% pop in the indexes is not a sign that the market turmoil is over. It is a sign that people are reacting hysterically to any shred of positive or negative news. A piece of bad news: help! The world is ending! A piece of good news: all is well, break out the Champagne! This is not the behavior of healthy markets. This is a sign of extreme nervousness.

My thinking is that we are close to the bottom but may not quite be there yet. There may be another 15% for these markets to fall. Who knows? Maybe more. Or maybe I am completely wrong. Maybe this IS the bottom. It doesn't matter, I don't know and neither do you. Reacting impulsively in this stock market is nothing short of gambling.

Today is the 14th, which means that tomorrow is the day of the month in which our monthly contribution to our stock portfolio gets executed. If you ask me, that is the only rational way to deal with the economic craziness that is surrounding us. The only thing I know for sure is that the turmoil isn't over. Not by a long shot.