"Invest in yourself and forget about your portfolio. You shouldn’t ever be losing sleep over your investments. Learn something new. There’s more to life than fretting about a financial nightmare that never seems to end. " So says John Wasik on Bloomberg.com in a column that consitutes a good response to those people (often salespeople) who say: If you loved stocks at Dow 14,000, shouldn't you really love them at the bargain price of Dow 8,000?
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Before deregulation made us all Dow watchers, savings meant money in a passbook and we only invested money in the stock market that we could afford to lose. But since the 70s our words to live by has been "the trend is our friend". Well, reality is setting in and we are beginning to understand that risk is not the difference between a 3% and 10 % return, but in fact, the difeerence between making making and losing money. Investing in the stock market is a bet and the wonders of compounding will not necessarily create a strong retirement plan. Better to think about savings and liquidity and living within one's means today than equating an investment plan with alchemy of inflated return projections.
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