While it’s not mathematically possible to spend less than you earn when you’re not making any money, there are still a number of things you can do to keep yourself from sliding too far into oblivion…
It’s a tough market, but don’t think that means you need more weapons for your portfolio. Now more than ever, don’t complicate your strategy. Simplify it.
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Late last year, when there was blood in the streets, a well known discount broker (Company A) was said to be on the verge of bankruptcy and the stock tanked 50% in one day. Not only did it tank 50% but the prognosis on the street, at least perpetuated by mainstream media, was that company was hosed and that they were going under. They didn’t have a rich history of being able to fight off adversity, they were relatively new in the financial business and lots of people figured they’d collapse. SIPC insurance would have to be initiated to save accounts and it was going to be yet another one of the casualties of the sub-prime mess. Would you have sensed that the market had panicked and bought shares? Or would you have joined the bandwagon and watched the shares fall into oblivion?
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