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It certainly looks like the end of the world today. I was playing golf this afternoon and did not realize the market had a nice dive today until I picked up my messages after the game. What? The bailout plan was rejected due to the Rep's objection? This would be a shock to the market as expected and frankly, I would expect a more than 1000 points drop.
I still believe something will be worked out soon to resolve this crisis. It's a political game. As much as I doubt that the market will crash from this point further downward, I also feel that, it's the right time to have a backup plan, ie, what will you do if the market does crash from here?
I hate to say it, but for those who do not over expose themselves and have large cash reserve right now at this point, this is a heaven for them. As much as I do not suggest bottom fishing, if the market indeed crashes another 10-15% from here with great panic, or reach the 60 months MA, I would be an aggressive buyer. But I will not hold on to anything I buy at the dip as a bottom fisher under extreme panic mode, I will sell them with any profit and run. However, I will remain on the sideline if the market does not dive tomorrow and the situation is still uncertain. In other words, I rather see a quick and severe drop than dangle with uncertainties.
This is not the time for panic. Instead, this is exactly the time that we should be calm and access all our options and decide how you will react to the market if it does crash. The sky might fall, but those who have a solid plan will prevail.
As always, don't simply follow anyone's idea to buy/sell stocks, it's your money and your decision.
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