US Economic News

[karlmarx]

The recent correction has resulted in quite a number of stocks(in NYSE/HKEX/SGX) on my watchlist going below my target accumulation prices.

I find myself with a conundrum : Taking a leaf out of Hamlet - "To buy, or not to buy, that is the question".

Is this going to be a short-lived correction ? Will there be more money printing or other matters that cld provide immediate relief ?
If it is going to be a longer term bear mkt phase leading to an eventual economic recession, wld it be better to hold off stock purchases to  take advantage of the property correction instead. 

Wonder if I am the only one here having such thoughts.

In the short span of our human lives, we do not get that many opportunities - it's tough making every precious one count meaningfully.

"Que sera, sera, Whatever will be, will be, The future's not ours to see ...."

Fed Officials Open Door to Rate Cuts as Coronavirus Risks Rise
https://www.nytimes.com/2020/02/28/busin...virus.html

If there are certain answers to these questions, the markets will not be at where they are now. I think it is best to forget about them.

Those who have interest in (and hence knowledge of) the market will not be waiting with 100% cash just for that day to come. The hardest thing to do is to sit still and do nothing.

It's a very seductive thought that one can successfully time the market bottom and 'make it big' when the recovery comes. The reason you don't hear of such things is because very few people have actually made their fortunes by going all-in during a deep market sell-off. Those that manage to pull if off should be considered very lucky. Lest we forget, let us be reminded that there is no known way to predict the market tops/bottoms. 

While we cannot tell where the top/bottom is, it should not be difficult for a somewhat skilled investor to tell whether asset valuations are cheap or expensive. I think that if an investor has managed to buy when it is cheap, or sell when it is expensive, then he/she should do pretty alright. If you only wish to buy when it is at the cheapest, and sell only when it is at the most expensive -- which is what most investors expect -- there will likely be plenty of disappointments with missed opportunities (i.e. ahhh, should have sold it last week!). 

Being exposed to such disappointments are natural and to be expected, but how frequent do you wish to be exposed to such potentially damaging emotions?

My take is, as always, the same; buy when you think it is cheap. If you are out of cash, just wait, or switch from the more fairly-valued assets to the more under-valued ones. If you find that the price of the assets you have purchased have continued to fall far further than what you paid for, you may have to reassess whether you have valued the assets correctly, and given sufficient margin of safety not just in terms of purchase price, but also to possible deterioration in asset quality.

Even after the correction, SGX-listed stocks -- both big and small caps -- still don't look cheap enough to me. On the other hand, HKEX-listed stocks, due to their higher exposure to the mainland and HK economy, look far cheaper.