Yeah I mean the professional class, which would include bankers, insurance company execs etc. But let's face it, the regular joes buy into it too. Look at all the lawn guys with 100% stock allocations in their retirement plan. Why would someone invest ALL their savings in something that has, in the past, fallen 89%? 1 hour with a competent financial planner would have most people having no more than half their savings in stocks, and less if they are older. Owning stocks when you still have a mortgage is also, for the most part, a bad idea. This whole "democratisation" of the market has just created a huge swathe of investors who don't know the true risks of markets and investing. Warren Buffett and John Bogle have effectively encouraged the average American to impoverish themselves by taking insane levels of risk, and now Obama is telling then to double up on that appalling loser. The leadership has let society down, and they *haven't yet realised this yet*. If Obama was smart, he would be telling people to only invest in stocks an amount they are willing to see fall at least 50% in the short-term i.e. make them cautious. Instead, he's telling them to average down a horrendous loser i.e. take *more* risk. It's crazy.
He didn't say the bottom is in. And try to get your possessive case right, by not using it when it is not required. Your post has illustrated your lack of both comprehension and communication capability. The less you write, the smarter you look.
Try to follow the chain of reasoning. The president saying stocks are a good buy means that i) he is extremely arrogant in overestimating his own knowledge and abilities ii) he thinks the stockmarket is "easy" iii) people like him (or like how he was 5-10 years ago) have a knee-jerk reaction to a 50% fall - "buy more". Once in a generation bear markets do not end while the average investor is responding to declines by saying "buy more". They end when the investors respond by saying "get me out! Stocks are insanely risky!" The fact that the President of the country finds it appropriate to recommend stocks just shows breathtaking ignorance and arrogance, and is symptomatic of those same qualities present across tens of millions of Americans who invest in stocks. That is why stocks are likely to keep on falling. They will keep going down until people learn to be humble, and appreciate the real risks involved in the market.
Regarding jawboning, this is always a disaster. For a bear to end you need maximum fear, not maximum optimism. Bears get *strengthened* by people becoming optimistic. About the bearishness, yeah I agree 200 seems outlandish. But if you look at the historical perspective, it has happened before. Anyway, price targets aren't that useful for actual trading, I am putting it out there so people realize it's *possible* we might go down that far.
I'm just partially joking with you. It seems strange to me that you take one person's comment and extrapolate it out like that. I see your point, but then you could also say that about any shill that comes on CNBC. Of course, this is the president we are talking about so he has special significance. We'll see whether your logic comes to fruition.
Oh, come on. He wasn't appealing to momentum players or bottom pickers. He qualified his comment with "long term perspective." Maybe it wasn't the best thing to say, but let's not read more into it than is there. First, his critics accused him of being too much of a downer when he was merely stating facts (transparency and all that) against a backdrop of cautious optimism. Now he's showing some more signs of optimism and his critics are overreaching with their interpretation. I believe in criticizing when it is due, but let's keep it balanced, eh?
"So ... Iâve been buying American stocks. This is my personal account Iâm talking about, in which I previously owned nothing but United States government bonds." Buffett in October '08 Obama Says Now May Be Good Time to Invest in Stocks Obama 3/09 Stay tuned.... WWGSD (What Would Paulson Do?)
Seriously, I'll write a very competitive OTC market in as many American or Euro binary puts as you would like, inside any bank-quote. 400-strike, all I need is duration and size.
Well, I didn't quite conclude it from his statement. It was more that I suddenly realised exactly what was going on in the minds of all the baby boomber Obama supporters. You know, the wishy washy middle of the road middle class professionals who hated Bush but aren't die hard Dems. Obama's pronouncement suddenly made me realize that whole swathes of American *really believe* that you always buy a market down 50+%, and you'll be ok. To which the only possible trader response is: ahahahahaha...