Learn From My Mistakes

The biggest mistakes I made during the dot com implosion (the last time I was wrong on a market) was believing the decline was merely “a dip” in 2000. I didn’t sell and I rode stuff all the way the fuck down to zero. On top of that, each and every time I had new money, I bought more of the same “cheap stocks” based upon the fact the stocks were down — nothing really materially great about said stocks. We have a similar situation today, where stocks are “cheap” but not really since the economy is worsening and looks to be getting grimmer by the day.

After 9/11, I all but gave up on the idea that I could ever make money in tech stocks, so I switched tactics and became a bond man, regional bank buyers, and general consumer of stocks of a defensive nature. Bear in mind, that bear market lasted for 9 months of 2000, 12 months of 2001, 12 months of 2002, and 3 months of 2003 before we truly bottomed. Along the way were insane rallies, such as the +22% lift in the SMH in November of 2002. I actually remember that month and I also remember the disappointment on the faces of the bulls when it was shattered to bits and pieces in December of 2002 for -24%.

Here is my advice and listen to me very carefully:

STOP BUYING STOCKS BECAUSE THEY’RE DOWN. Now is the time to care about fundamentals. If you’re too stupid to read a balance sheet, Stocklabs does it for you with our fundamentals ranking system. Or, you can just trust in the efficient market theory and buy the 52 week high list. There are people out there who are professionals and do this for a living. If a large capped stock is within 3% of a 52 week high, there’s a reason for that.

WHEN TO GET BACK INTO THE META’S of the world?

You’ll have plenty of time to scam your way back into shit stocks — because it’ll be obvious. The bottom of 2003 was obvious, as was the bottom of 2009,2012, 2014, 2015, and 2020. There will be a policy change and you’ll hear a bunch of bullish statements and you’ll miss out on the first moves up — but rest assured once this turns higher into a bull tape — there will be plenty of upside to both savor and enjoy.