Why I’m buying
The market is in free fall. Friends are calling and emailing in a panic. My response: I’m buying.
Investors today seem as fearful as they’ve been since, perhaps, the Great Depression. And as Warren Buffett once famously said: “Be fearful when others are greedy, and greedy when others are fearful.”
As he always does, Buffett’s put his money where his mouth is, garnering stakes in Goldman Sachs and General Electric on the cheap as the $700 billion bailout plan was under debate. Yet the bailout’s passage has done little to quell the fears. Instead, fear seems to have turned to panic.
Today, the Dow plunged below 10,000 for the first time in four years. The broader S&P 500 index is off 27% since the beginning of the year.
Is the economy going to disappear? Are all businesses going to close their doors due to lack of credit? Is every single investment bad?
Maybe. But I’m willing to bet that’s not the case, at least not long term. So before the market closed, I took a deep gulp against the rising panic that tomorrow could be worse and sent cash to one of my lagging international equity funds.