Mallika Chopra - February 27, 2007

Alas, it was not a good day for global stock markets.
I have to admit the stock market has always fascinated and totally befuddled me. It is a manifestation of perception that affects our pocket books in a very real way.
The tumbling markets which began yesterday in China, then spread to Europe, the US, and back to Asia, also showed how interconnected our perceptions are around the world. In the NY Times, one economist is quoted saying, “It was sort of one of those days where somebody snaps their fingers, and the market’s hypnotic trance is over." There wasn't one reason, but a collection of many reasons, worldwide, which resulted in the sell off.
The Dow Jones fell as much as 546 points today, before closing over 400 points down, the steepest slide since 9/11. Per an article on Yahoo, "The drop hit every sector across the market, and a total of $632 billion was lost in total in U.S. stocks on Tuesday, according to Standard & Poor's Corp." And, yet investors don't seem to be panicking.
Reading the Yahoo article made my head spin trying to keep in mind how all the dots are connected. Interest rates, housing markets, durable good sales, inflation, bond prices, terrorist attacks -- the "tangled hierarchy", as my father would say, is overwhelming.
Would love for someone to help break it down, simple... Should I be buying or selling tomorrow?
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Posted by Mallika Chopra at February 27, 2007 07:52 PM
Hi Mallika,
Stock Market is a way for those who are owners of stocks to increase the value of the stocks which they own.
Investment in stocks should never be made to earn short term profit. Ofcourse if somebody want to put up her money in bets or gambling, she should go for gambling in Stocks.
Normally for long term investors falling markets are the best time to invest remembering the above point.
It is time to invest for long term. Buy for long term.
It is always better to invest in stocks as if one is investing in purchasing a house for herself.
(Holistically nobody owns anything. We are keeping holistic and spiritual outlook out at present, i will add it later.)
Stock Market is a way to rotate money. It is called a Monetary Cycle.
[More to come]
With lots of Love
Rajesh Sharma
hi
my fingers are crossed, its a budget day in india and currently PC's speech is on..
but equities are a best bet for long term investments..i would stay away from options and futures..dipti
Thank you Mallika for bringing us highflying spiritualists down to earth lol.
Well said dipti, stay away from futures and options and stay in your real investments.
Where is Navin bhai, our resident stock market expert in India?? I am sure he will say "Remain cool and remain invested in fundamentally good companies..."
Hi Rajesh, well said.
Harb
Hi Mallika,
The best way to play with stocks is to buy atleast 5 year old listed company in India. Add your goodwill and come out with a public issue and ADR's.
Than play with stocks its fun. You lose some you make some.
Companies which play around stock market holistically are win win for all, like Infosys.
Thanks Harb.
With lots of love
Rajesh Sharma
My feeling is that 02-28-07 is not a good day to go bargain hunting.
Hi Mallika,
As a market investor and former managing director of a stock brokerage firm, I think this drop is a great buying opportunity!
Did I lose money today, Yes, of course, but I am still way ahead for the year and will use this drop to buy back those stocks I liked but thought were too high. I recommend small Asian mining companies, (in the Philippines and Australia) and large cap. Asian property developers. As a caveat please take your profits and be out of the market by August 2007 since October, especially in a 07 year, is very dangerous!
Good Luck,
Stan
Dear Rajesh,
Today was the budget day for India. They say it was so so budget. Which are the best companies to invest in today's market?
India and China are supposed to go great guns in the next decades and by 2050 they will overpower the America is what is predicted by the economists. Name of the game is money!
Mallika:
If you are thinking of buying or selling because of drop in the market.. then the chances are you did not choose your stocks with due diligence already! :-) Stocks you buy should have nothing to do with the markets swings - short term or medium term.... but their fundamentals and future growth. You may look for bargains.. but you would have to do a lot of research before such drops happen.. and you would know exactly where to put your money when these swings happen!
I had rolled over the entire 401k from an old employer to IRA in 2005.... and that portfolio is up more than 120%... and it fell quite some yesterday.. but I am staying put.. no reaction...
Cheers,
desh
Dear Obro
#8,
Investing money in China is always risky as it is a communist country. Government in China can brick back any law detrimental to Multinationals at switch of a button.
Long term investment in China is not safe.
India is better option than China for Investment.
Even Easter European Countries which have merged in EU are good investment options.
Dear Desh,
You said "Stocks depend on fundamental and future growth"
My dear friend future growth again depends on market and market swings. "WHO CAN CALCULATE FUTURE GROWTH" Does anybody, (except yogis staying on himalayas for thousands of year - LOL)have the power to calculate future growth.
With lots of love
Rajesh Sharma
Rajesh:
By "FUture Growth" I mean - growth in the shareholder value of the company. It does not necessarily always mean that the market has taken that into account. As for who can predict future growth.. it is just a forecast and if you have your assumptions strong and good.. the chances are that your prediction will be good as well. That is one of the reason why Buffett goes for companies with least reason for heavy future investment (eg; Coke, American Express).
I would strongly suggest a book written several decades back by Philip Fisher called "Common Stocks and Uncommon Profits". It is a classic.. and very well written.. and presumably Fisher was one of the two people who helped shape Buffett's stock-picking vision (other was Graham).
Cheers,
Desh
Drishtikone.com
Hi Harb,
Thanks for remembering me. And you read my thoughts right.....if you are invested in fundamentally sound companies making consistent profits, then you should not panic and stay put. But if you know that you own some junk stocks then this may be a good time to switch to quality stocks which you always wanted to own but could not because of their high prices.
The recent worldwide crash in the markets was due to fears of some regulatory action in the stock markets of Chindia. But actually, if you ask for my personal opinion, then I would say that the global markets are now controlled by a group of less than ten big (and I mean really BIG) fund houses who manipulate these falls at a pre-fixed time. By acting as a cartel, they make money both when the markets go up and when they go down.
Cheers!
Navin
Finally, this was my third experiment. The Internet and The Market are One. This is mind blowing or maybe it is just coincidence.
Amazing correlations but some don't make sense. There were numerous Internet (collective mind)Indicators (excluding foreign language sites, so Chinese thought was not included) English only indicators that dropped and rose dramatically 1 - 3 days before the market dropped.
The "Internet Negative Context" Index jumped. The "Internet Positive Context" Index dropped.
I am going to put up a web site called the "Collective Thought Index". Since thought creates reality my original premise is that I can use the "thought" on the Internet to predict future reality. For the comprehensive indicators I think I will charge a subscription fee.
I also suspect that that which is known unconsciously by people is actually reflected in their communication activity. You know many scientists scoff at the idea of Oneness and a collective all pervading intelligence. This might provide objective proof if I can show that people can sense impending events. Even if they still don't accept it we will have a working practical application based on it.
Well it’s a thought anyway, need to get some investors involved for proof of concept.
You live in a world of excess
where more is more
and less is much less
A day without fame
is a waste
and a question of need
is a question of taste
You're so flamboyant
the way you look
It gets you so much attention
Your sole employment
is getting more
You want police intervention
You're so flamboyant
the way you live
You really care that they stare
And the press deployment
is always there
It's what you do for enjoyment
You live in a time of decay
when the worth of a man
is how much he can play
Every day
all the public must know
where you are, what you do
'cause your life is a show and
You're so flamboyant
the way you live
and it's not even demeaning
You're so flamboyant
It's like a drug
you use to give your life meaning
You're so flamboyant
The way you look
It gets you so much attention
Your sole employment
Is getting more
You want police intervention
Every actor needs
an audience
Every action is
a performance
It all takes courage
You know it
Just crossing the street
well, it's almost heroic
You're so flamboyant
There you are
at another preview
In a pose
the artist and you
To look so loud
may be considered tacky
Collectors wear black clothes
by Issey Miyake
You're so flamboyant
the way you look
It gets you so much attention
Your sole employment
is getting more
You want police intervention
You're so flamboyant
The way you live
You really care that they stare
And the press deployment
is always there
It's what you do for enjoyment
You're so flamboyant
You're so flamboyant...
Mon ami Jean,
That was a fantastic poem.....almost an ode (to me?). ;) Good to know you are alive and kicking.
Dear Richard,
The idea sounds good. Work on it.
Cheers!
Navin
Stan the man is a "market investor and former managing director of a stock brokerage firm"; o my stars and garters, now my faith in humanity has been entirely eradicated!
Nice ode JF!
Peace
Mallika,
There is no reason to panick. This really all started when Alan Greenspan, former head of the federal reserve, spoke in China and cited concerns about inflation in the US and because there is speculation that the Federal reserve will raise interest rates. The stock market will rebound, eventually over the next few months, as it always has (in the long run) throughout history. If you can hang in there for the next few months, maybe 6 at the most, the stock market will be back up above where it was.
Craig,
Many years ago the student ask the Teacher what should I do, and the Teacher replied,
“Some men have talents in their hands and can become great builders, sculptors or paint beautiful pictures, while other men have their talents in things of the mind and can write great books, or teach mathematical sciences. The student replied, “ But Teacher I have no talents, and the Teacher replied, "have you ever though about becoming a stockbroker"?
Kind Regards,
Stan
I work at a predominately Chinese design center in Silicon Valley and I am learning a lot about the culture without having to leave the US. I don't know why, but I keep asking WHY? I find the Chinese people to be very similar to the Southern people of the USA - my personal observation. Maybe I a wrong and please correct me if so.
Here's one example of what I had to deal with this morning from one of my new supervisors that I have been working with for a little over a year, as a result of some recent moves to our floor ...
BOSS: We have a coffee pot.
ME: Yep.
BOSS: Can we get a 2nd hot water station? We have a coffee pot.
ME: I will look into having a 2nd hot water stations installed.
BOSS: Let me show you.
ME: I see.
BOSS: We have a coffee pot.
ME: I don't drink coffe.
BOSS: I do.
ME: I will call on the hot water unit now.
I am sorry, but I don't make coffee unless I am forced too (or I am going to have a lot of fun with the requests and making muddy water with magical 'be my slave' dust put in it) or if we ALL take turns making it and if I drink it, I will help make coffee. Monday I was out sick and Tuesday I came in sick and after the flood of requests, I left at lunch sick. Today, I am well and I still get silly requests...so I must ask WHY? And I ran from the South over 25 years ago, so maybe that's why...can't run or it will catch up with you :-) So I play and have fun now and the coffee is the big game the bored boys want to play. Okay, I am going to behave. It's party time!!!
Love, Char
Har har har . . .
Good 1 Stan
The correction of yesturday is being blown out of portion by the 'drama' seeking media (they make money off disaster, remember). 400 plus point drop? That was a common accurance in the late 90's after the tech 'bubble' burst. All those internet companys that went belly up because they were really nothing but speculation. 401ks emptied in a year. If you were getting ready to retire in '99 and didn't diverify in time you were screwed.
When people talk about the great Clinton Ecomony they leave out that year.
In my line of work we say you're only has good as your last day.
The correction of yesterday is being blown out of portion by the 'drama' seeking media (they make money off disaster, remember). 400 plus point drop? That was a common occurrence in the late 90's after the tech 'bubble' burst. All those internet companies that went belly up because they were really nothing but speculation. 401ks emptied in a year. If you were getting ready to retire in '99 and didn't diversify in time you were screwed.
When people talk about the great Clinton Economy they leave out that year.
In my line of work we say you're only has good as your last day.
The asian markets are mostly lower in the afternoon session of Thrusday(Japan and China)......Could be more selling in Europe and US tomorrow Thursday. Not time to buy yet.
Bonnie
All said and done.
The simple logic is,
There is this Universe / Supra Universe / Cosmos / Galaxies / Stock Exchanges / Stocks / Money.
Every thing is available for free.
Whosoever is powerful physically or through weapons uses violents means and grab the freely available product / stock from Supra Universe / Universe.
That powerful thing grabs all essential things from this Supra Universe through violent means.
When the less powerful individual need that thing, it has to go to the powerful thing and ask for that essential item.
The powerful says "if you want it do some hard or intelligent or physical work for me, or die without the essential item, or take it from me if you have the power or get killed."
It depends on the less powerful individual how it behaves.
This same logic works in stock market.
First the powerful one grabs all productive land through violent means from the less powerful and than makes some useless documents or server where it loads those records and gives those records to less powerful.
Less powerful purchases that useless share which is called stock.
Powerful will manipulate it whenever it feels manipulating.
Thats the name of the Game.
Thanks to all.
Be Supreme
Let all have the same power
Lots of Love
Rajesh Sharma
What if, a new Mall opens.
What if, business model changes, based on immaterial spirit inter-relationship profits.
What if, we discover the mystery non-formula that all depth needs of each humans are interconnected to manifest joy on the world scene.
What if, fashion is orchestrated through the hands of fresh joy, designing new mental-personality-clothes. Clothes always in full free-prize for everyone. Clothes breathing the world news on Channel One.
What if, we finally have the dynamic power to see ourself each night in presence of love and billions of people, clear eyes, foot rhythms... healthy and happy.
What if, the wizard frees itself from is own prisons, undress the rich and dress the beggar.
Yes, we could live to tell how much you are wonderful...
Buy or sell is too black or white. It's a false choice and a fool's dilemma.
For example, if a stock like, say GSCT or LTHU suddenly goes up 200% and you've got $1,000, should you sell all of it? If you do, and it flat-lines for a month at that new level, and then rises another 20%, should you buy? Then you're beginning to buy high and sell low, which is what always happens when someone tries to beat the market.
But say it goes up 200% and you peel off $1000 and redistibute among the remaining stocks in your portfolio? Then you're getting into some disciplined investing.
I read a book a long time ago, How to Make a Million Dollars in the Stock Market. It actually represented a highly conservative, disciplined method of making money using highly volatile stocks. Just because your METHOD of investing is conservative, doesn't mean your MEANS of making money has to.
Anyway, I think there are a LOT of worthy green stocks out there.
I'm actually VERY pleased with my portfolio from an ethical standpoint.
EVEN on its worst days!!!
And here's why: every dollar I put INTO a green economy like NWGN is a dollar I've permanently retired from the "soot" economy.
Dana:
Here is an interesting article you might be interested in:
www.alternet.org/envirohealth/48681/
One of the amazing statements in the article was
"Some companies have caught on recently to the realization that what's good for the environment is also good for business"
We are not there yet, but it is changing. Green investing is the future of the market
Bonnie
Thanks, Bonnie. Times are exciting!
Here's what we need to do for our future:
1. Bring home our fuel sources: get off middle east oil and shift our demand back to domestic resources of ALL sorts: nuclear, coal, etc. where we can better strategize.
2. Sequester CO2 emmissions temporarily through regulation. Invest heavily in PHEV technology.
3. Begin to divert those CO2 emmissions to create green algae growth opportunities that complement PHEV technology.
4. Create oversupply of algae fuels to drive the price of oil down so hard it'll never be worth it again to draft another ounce of it up out of the ground ever again.
Mallika: You may recall we met about seven years ago in Chicago.
In regards to the stock market, the key is to remember "the trend is your friend." The market is driven by fears and desires. These swings in the market are the result of irrational behavior. You can profit from this by asking not what is happening but why.
There wasn't anything of substance - including Greenspan's comments - that occurred to cause this recent downturn. Contrary to what many will suggest, especially professionals that recommend 'long-term' investing -- you can profit handsomely by understanding and taking advantage of others irrational behavior - even in the short term. All you need is a strategy that you confidently believe in and a contrarian view. The market is usually an indication of what happened - sort of like the body is the manifestation of what your mind used to be like - not what it is now.
If the overall trend is intact, loading up on favorite stocks on downturns is a great way to pick up a little extra and equalize over the long-term. These ripples between the bigger waves of the overall trend are opportunities.
Look for more of this in the future as fears over energy and the environment predominate. It's going to be very interesting - especially as more governments take control of oil. The logical question is what are the alternative choices and which ones will prevail. They will likely be what used to be contrarian and previously unacceptable options.
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(If you haven't left a comment here before, you may need to be approved by the site owner before your comment will appear. Until then, it won't appear on the entry. Thanks for waiting.)Mallika: You may recall we met about seven year
Thanks, Bonnie. Times are exciting!
Her
Dana:
Here is an interesting article yo
And here's why: every dollar I put INTO a green
Buy or sell is too black or white. It's a false
Overthrowing!
No Mallika, do not 'buy' nor 'sell' nor 'barter' . . .
Emgage not in their prostitution of humanity.
Overthrow, aye, overthrow!
I'll help!
Peace