Thursday, April 2, 2009

Is now the time to invest? Is economy rebounding?

By Richard Kelleher, M.B.A.

Certified Marketing Sociologist


Marketing sociologists are optimistic, but it is more important to be accurate. After all, when you’re helping businesses increase in the millions, you need to be right.

All the news from Associated Press seems rosy. It would appear now is the time to get into the stock market.


Marketing sociology is a science. For investing, you must track cycles, as pioneered by Edward R. Dewey.


There’s a lingering question – and the answer may be… how big of a gambler are you?

Look at the Dow 100 year chart. If you look at the peaks and troughs for the past 10 years, we could be in the period of roughly 1916 to 1920 where there was a downturn, but a horrendous upturn at the end of this period. There was a 200 percent drop in the Dow then, same as now.


So it could appear it is the time to invest.


On the other hand, , if you look to the right of the 100 year chart, it does not provide enough information. Sure, it could be a 200 percent fall, or is the current chart going to go the 800 percent drop trend of 1929 to 1932?


It is a personal belief now is the time to – and remember, no matter where you invest, educate yourself first – invest in property. So let’s say you buy in Santa Barbara and those earthquake reports on NBC are accurate. You’re going to end up with some fine undersea property. On the other hand, you could invest in Yuma and get at least five times as much land, but if California doesn’t fall in the ocean, you’re going to miss out on a lot of fun living in that double-wide in Yuma when it’s 120 out. So invest wisely.




A big reason for investing in real estate is this report:

Associated Press

Posted: 04/02/2009 12:01:00 AM CDT

“WASHINGTON — Rates on 30-year mortgages fell to the lowest level on record for the second consecutive week after the Federal Reserve launched a new effort to assist the staggering U.S. housing market.


“Mortgage finance giant Freddie Mac said today that average rates on 30-year fixed-rate mortgages dropped to 4.78 percent this week, from 4.85 percent last week.

It was the lowest in the history of Freddie Mac's survey, which dates back to 1971. Rates are down by more than a full percentage point from a year ago.”


Associated Press wants you to believe stocks are up. I’m not sure. I’ve got some option trading going. I may be out some money if they shoot up and I didn’t purchase them at a low price, but as I said, it is better to be accurate than lose millions. Some people bet, too. Me, I study the charts and every chart I’ve seen is like nothing in the past five years. When I see trends that have been exhibited in the past, I will feel it is safe to go back into stocks. I’m not seeing those historical trends at the moment.


As I’ve said, marketing sociology is a blending of history, marketing and cycles. I’m not seeing cycles in the stocks I am watching that I am comfortable with yet. Hey, it’s your money though, don’t let me stop you.


CHRISTOPHER S. RUGABER, AP Economics Writer

“New signs that the recession could be nearing a bottom emerged Thursday, as factory orders were far better than expected and the Dow industrials surged over 8,000 for the first time in two months.


“The Commerce Department said orders for manufactured goods rose 1.8 percent in February, reversing six straight monthly declines and easily beating estimates of another drop. Other economic indicators came in better than expected Wednesday, including construction spending and pending home sales.”


SARA LEPRO, AP Business Writers

“Investors dove into stocks Thursday, extending a rally that gave the Dow Jones industrial average its best four weeks since 1933.


“Stocks rose across the board in heavy trading following an accounting rule change that will help banks and commitments from world leaders to toughen up regulatory oversight of financial institutions.”

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