Investing, Personal Finance

Optimism in The Stock Market

Dave Kansas of the Wall Street Journal has what I like to see in a capitalist economy: optimism. Talking about the year ahead, he described the stock market as looking “to the future, rather than the past.” Isn’t that exactly what we should do with our money? We save for the future, we plan for the future, we budget for the future, we have an emergency fund for the future, we have insurance for the future.

With the stock market, if someone says, “The market went down,” we should say, “Yeah, so?” because we all know that the way a capitalist economy works is that the stock market can’t stay down. People have too much optimism; even if they might lose it all, there’s still hope.

If you’ve never bought stock before, now is an excellent time to start. We have a new year, a new President, a new administration, and really, after everyone runs out of money what’s left is new money, too. It’s the rookies that make the simple decisions, look at things in their lives versus the things deep in the economy.

We know things like the new administration’s policies and the Big Three Auto Companies are telling us that Green is the new Gold Standard. I wonder if there’s any stock for sale based on Going Green?

We know that everyone’s not doing so well, so most stock is pretty affordable, and once we start buying it, the prices will go up. Yeah, that will be our fault. All we have to do is buy it.

We know that every “back in time” movie or show includes anticipation about whether the hero will do the wise thing and invest in some stock we know will boom. Then when they come back to the present, they can cash out and be rich.

We know from watching It’s a Wonderful Life that all these totals of our interest-bearing investments are imaginary, because the money is in your house, and his business, and their tractor, and that everyone in this economy is counting on our dollar to continue running.

It’s a difficult decision to make for most personal financially frugal sorts, because we need every dollar we have to work its hardest for us, not necessarily the community at large, and to just put it in an investment and wait for it to grow is not something we trust a whole lot. But really, when there’s nowhere to go but up, isn’t it a pretty smart move for the short term? For rookie stock buyers, it’s best to use these three steps to invest for the short term:

Set a goal of how much money you want to make; Set small and concrete goals, like enough to cover the balance of your credit card, the rest of your student loans, or for a down payment on a hybrid.

Buy the stock that makes most sense to you, not to some article writer or big shot trader, but to you.

Wait until you’ve made that money, and then sell.

Above all else, be patient. The stock market takes time. Sometimes it takes leaps, but mostly just time. And remember, it works. This is the same thing that your retirement investment is doing, your bank, your life insurance. Some are using it to play games on getting ahead, but many are just waiting to make enough to cash out.

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