Cashola

Financial News = Financial Doom

I was sitting at work today looking over the market news and surprise surprise…the market’s been acting like it’s the apocalypse. There seems to be no good news concerning the market. I’ve watched my Vanguard Star Fund fluctuate up and down - and then down some more. Being a new investor, it did draw some concern. I thought “should I put more money in my fund if the market is looking so poor?”. I’m sure many of you have thought the same thing. Despite how we feel…the answer is YES! I must stick to the advice and info I’ve learned and blogged about, because if I didn’t, I’d be a coward who says one thing and does the opposite. Dollar-Cost Averaging and Long-Term Investing type of strategies is the key to wealth. Block out the noise, and keep on your course.

Bernanke’s Fed Fails

Yes, Ben Bernanke has run out of ammo, leaving him to sit there with his fingers crossed as he lets the market take on it’s own course. The Federal Reserve released minutes and has announced yesterday that our economy hasn’t seen the worst of it yet. The economic growth forecast for 2008 is as hopeful as Gary Coleman hitting 5 feet tall. Bring on the inflation and unemployment. Want to see the numbers? Taken from an article on Forbes.com:

“the central bank now expects 2008 GDP in a 0.3% to 1.2% after the downward revision, unemployment of 5.5% to 5.7%, and inflation of 3.1% to 3.4%.”

After the release of the Fed’s minutes, the already struggling market took another blow.

“The Dow dropped 189 points, or 1.5%, to 12,640, with much of the decline coming after the Fed minutes hit. The S&P 500 lost 17 points, or 1.2%, to 1,397, and the Nasdaq shed 35 points, or 1.4%, to 2,457.”

Not only that, but travelers will be feeling the heat immediately. Due to rising gas prices, which by the way oil hit a record breaking $134 a barrel today, airline stocks plummeted. American Airlines cut their fourth quarter capacity by up to 12% and put 75 planes to rest. American Airlines will also be raising passenger fees and charge $15 for your first checked bag. With news like this, it makes me apprehensive to start my investing plan at the end of this month and revert to strictly saving, but I must practice what I preached in my previous post, “Psst! Want to know the best time to invest?“. Wish me luck.

Psst! Want to know the best time to invest?

So, you want to know the best time to invest? I’ll tell you. The best time to invest is now! There is no one in the world who has a crystal ball or a little bird that whispers in their ear to tell them whether the market will rise or fall. One of the biggest mistakes investors make is attempting to time the market and using past performance to determine how the market will perform. A majority of investors are better off using whats called Dollar-Cost Averaging. With Dollar-Cost Averaging, an investor invests a fixed dollar amount at regular intervals. For example, my goal will be to invest $400 every month, regardless of how the market may be perceived at the time. Using Dollar-Cost Averaging with Index Funds may be the best advice for most investors to take. The advice doesn’t make for exciting reading, but who cares?!

Yahoo bid dropped, Market set to fall

The stock market as a whole is set to open lower today due to Microsoft backing out of it’s bid for Yahoo. This bid retraction put a blow to investor confidence and has “clouded” the outlook for mergers and acquisitions. Yahoo is now down more than 21%. Read the full article on Reuters.com.