well buy 1 share everyday for the next 200 days / you will not miss the bottom

else adopt varied methods / alternate day buying / weekly buying / this removes the fear in you

the lower it goes / great / you will make more money

I personally like the advice buy low and sell high but find it far from simple. Does low price mean price per share, total market cap, position relative to peers, price to earnings or book or sales or earning growth? What about bond yield, rating, maturity? Those last sentences are a better reason to hold that advice to yourself, you have to advise a lot more research and planning along with it. It’s no fun to assign work.

I also question the assumption that the market price is generally accurate at ‘that time’. Were the big financial companies situations really good investments a year ago? Were the big Ponzi schemes good investments 4 months ago? The market tries to be efficient but is still based on perceptions, forecasts, and greed. I agree that if you know the future you know the answer, but I don’t agree that if you don’t know anything you should trust the market or assume that it knows.

As far as panics and exuberance go, how can you point these out without knowing if it is low or high? Should I sell all the nanotech, clean energy, solar, biofuels, genetic investments I have if they actually start catching on, is that exuberance? Should I avoid the next Microsoft or Google type IPO if there is any hype around it, too much exuberance?

I believe the real issue is to avoid ignorant decisions. The only way to do that is to know what you are doing. Don’t try to buy low if you are ignorant of what low means. Don’t trust the market if you don’t know how it works. Follow those other little pieces of advice that pop up from time to time… Invest in what you know, build your knowledge, make a plan, and put time and effort in before money.

The idea assumes everyone follow trends and loses money. So when people are pulling out of the market it is time to buy. When people are jumping back in it is time to sell.

On a side note, anyone interested in buying a house that is waiting for prices to go lower is an absolute idiot. If you wait you will miss the bottom, I promise you that.

Seriously, though, thanks for reframing the argument. I’d been thinking it was completely irrational for people to keep selling after the Dow had gone down 4,000 points.