Some of you were anxious to get the second installment of my post entitled “How to survive difficult times – Part 1.” It is understandable that many of you wanted to read it considering that we are in such difficult times. So here is the second and last installment of this two-part post on how to survive difficult times. 4.) Don't panic – Warren Buffett, once wisely said, “Long ago, Sir Isaac Newton gave us three laws of motion, which were the work of genius. But Sir Isaac's talents didn't extend to investing: He lost a bundle in the South Sea Bubble, explaining later, 'I can calculate the movement of the stars, but not the madness of men.' If he had not been traumatized by this loss, Sir Isaac might well have gone on to discover the Fourth Law of Motion: For investors as a whole, returns decrease as motion increases.” I certainly agree ! Most investors bail out of the market upon the first sign of bad news or if the government fails them. They liquidate their positions even at a … [Read more...]
How to survive difficult times-Part 1
While waiting for our fight to Manila on our trip to the Summer capital ast November 2008, CNN reported that the three major U.S auto makers namely Ford, GM and Chrysler has asked the U.S congress for $ 25 Billion dollars to bail them out. According to CNN, if the U.S auto industry fails, this will translate in roughly 2.9 Million job losses; truly these are the signs of difficult times. The other day, Citigroup announced another set of job cuts bringing the total job cuts to more than 50,000. More signs of difficult times to come. On a more personal level, I talked with my mom last night and she revealed that some of my relatives are worried about difficult times. They talked about how the global financial crisis has affected their investment portfolios. They are all asking the question on what action should they take. The future seems to look for grim. Difficult times have gripped even the closest of my family members. It seems that there is no end to the deluge of bad … [Read more...]