Do you remember when you tried your first beer because everyone else was doing it? Are you the type who sees all the big movies on opening weekend so you can talk about them at work on Monday morning? Or maybe you bought Wells Fargo (NYSE: WFC) or US Bancorp (NYSE: USB) in late 2006 because housing was doing awesome and those companies were rolling in the money? Humans are social animals, but that impulse to be part of the crowd is destroying your chance to find the next home run stock.
Does this year's $1.6 trillion deficit scare you? What about the multitrillion overspending of next year and the year after that? Are you worried that the Federal Reserve's "teaser" rates to banks will come back to bite us?
Family Dollar (NYSE: FDO) sells everything a penny-pincher could ask for at rock-bottom prices. But when pushed to the limit, consumers can only spend so much.
Are you worried yet?
Does the fact that we've come roaring off the market bottom bother you?
Does the really severe recession we've been in with its banking crisis, government takeover of companies, and near-double-digit unemployment make you think that this time, it really is different?
Stupidity is contagious. It gets us all from time to time. Even respectable companies can catch it. As I do every week, let's take a look at five dumb financial events this week that may make your head spin.
If you're feeling good about the market, you're not alone. Take my hand as we go over some of this week's more uplifting headlines.
People love a hot story, and the financial markets always oblige. But by the time you hear about it, you've usually already missed out on some of the most significant gains.
"Really? The Top 10 Depression Stocks? That's a preposterous headline." I'd guess that's what you're probably thinking.
Individual stocks can surge by 10%, 25%, or even more in a short time. And they can fall just as far, just as quickly. For example, shares of United Airlines parent UAL (Nasdaq: UAUA) fell by 21% one day last week, when it announced that, like several of its competitors, it would dilute shares to raise more money.
However hard the market slams a stock, there's always the chance it'll come bouncing right back. We'll consult our Motley Fool CAPS community to find shares on the rebound, examining one specific sector of the economy in search of companies with rising CAPS ratings.