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Market Commentary: Fear

October 6, 2008 – 1:44 pm

We have discussed and written about the only two emotions that mean anything in the stock market: fear and greed. At this point Fear is rampant. You can see it by the amount of money that is flooding into U.S. Treasuries as the returns or yields on those investments have been pushed to extreme lows. This is happening even as the government gets ready to spend huge amounts of money to get us out of a certain recession. 

Fear is in control. As an investor, if fear is at a maximum then it is time to invest in the market. September is over which is usually the worst month of the year and of course this past month has been particularly bad. The first two weeks in October also has a history of being weak. However, the second two weeks have the opposite reputation.  

Frankly, I think it is in the hands of our government. Can they rebuild confidence in our financial system? If they can there is an end in sight. If they can’t for whatever reason we are in for a long painful recession. 

Good Trading
Steve Peasley

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