Your Best Chance to Profit in 2009

If, after 2008, you're still looking at the stock market as a way to fund your retirement, most people probably consider you a few congressmen short of a bailout. (Zing!) It's probably progressed far beyond the point of people refusing to make eye contact with you. In all likelihood, your dog is, too.

Yes, it's tough proclaiming yourself a bull after a year in which every bull became a steer.

But there are a few perks. Like getting the profits that come from buying stocks at what could be some of the best prices you'll ever see.

A brief history of 2008
Last year was a fantastic demonstration of what happens when, in a highly leveraged world, everyone needs liquidity at the same time.

Anyone who borrowed to buy mortgage-backed securities needed cash as mortgage values plummeted. Ambac (NYSE: ABK  ) and the other bond insurers needed cash as the mortgage-backed securities they were guaranteeing fell. Banks needed cash to maintain their capital ratios as defaults escalated. AIG (NYSE: AIG  ) needed cash to balance its losses in credit default swaps. Hedge funds needed cash to fund redemptions and reduce leverage as assets declined.

The problem is, when everyone needs cash, the only way to get it is to sell off assets. And that's what investors did, dumping almost every asset class with the exception of ultra-safe Treasuries. The stock market took it on the chin.

An overreaction
That's not to say that the market collapsed simply because everyone cashed out. The problems in our economy are real. We've seen huge bankruptcies, the unemployment rate has spiked to almost 7%, and consumer confidence is low. Companies that need cash are finding it tough raising money at reasonable costs.

But the carnage in the market isn't limited to the shaky companies that are likely to suffer the most. The S&P 500 contains the biggest, most successful, and most stable businesses in America. Yet more than 94% of the companies in the S&P 500 fell during 2008. Over 30% lost more than half their value! Certainly, deteriorating business prospects are responsible for some of that drop. But based on valuations, it seems likely that stock investors are selling because they must. Like everyone else, they need the cash.

And that's a really great thing if you're not one of Wall Street's forced sellers.

The sweet spot
Large-cap value stocks could be the best way to exploit this opportunity. I'm not just talking about slow-growing companies trading at low single-digit earnings multiples, but also compellingly cheap growth stocks.

For instance, these days, the universe of large-cap value stocks includes Google (Nasdaq: GOOG  ) . Google has huge barriers to competition, $14 billion of cash on its balance sheet, an innovative culture, a 21% estimated annual growth rate going forward, and is trading for about 19 times earnings. At these prices, Google is a large-cap value stock.

So why are large-cap value stocks a great investment these days? Not because these stocks are certain to outperform the other categories under all circumstances, but because they present the ideal trade-off between risk and reward in these troubling times.

While there's a good chance that the economy will start showing signs of life sometime in 2009, there's a possibility that things will get even worse. When you're betting your retirement, you should own businesses that can survive the worst-case scenario.

Low risk, high reward
Generally, large-cap stocks fit that criterion. They have the most stable cash flows, the most well known brands, the greatest economies of scale, and the best chance of recovering from mistakes.

Would you put your money on McDonald's (NYSE: MCD  ) to withstand a depression, or Krispy Kreme (NYSE: KKD  ) ? Would you bet on Wal-Mart (NYSE: WMT  ) , or Dillard's (NYSE: DDS  ) ? These two examples may be somewhat hyperbolic, but it's absolutely true that powerhouses like McDonald's and Wal-Mart are far more likely to survive than companies with smaller moats because they have the financial clout, the economies of scale, and the proven, winning business models.

In normal times, you'd really have to pay up for these sorts of dominant companies. But thanks to forced selling from investors struggling to raise cash, right now you can buy some excellent businesses extremely cheaply. The S&P 500 is trading at just over 12 times 2009 earnings estimates, its lowest earnings multiple since the 1980s. What's more, due to the poor economy, the earnings of these powerhouse companies will be depressed in 2009, which means that the normalized earnings multiple is even more compelling. Large-cap stocks are extremely cheap, and I believe will offer superior returns over the next few years.

The Foolish bottom line
Of course, you still have to be careful -- as 2008 has shown us, you can't just throw a dart at the S&P 500 and expect to avoid a blow-up. You still need to pay attention to balance sheets and how much cash companies are bringing in during these troubling times.

But if you're alert, you can find the stocks right now that will pay for your retirement. So, now is a good time to start buying large-cap value stocks. If you're interested in ideas, our Motley Fool Inside Value team has identified the dirt cheap stocks that we think offer the most enticing combination of safety and upside potential. You can read our complete analysis with a 30-day free trial.

Fool contributor Richard Gibbons knows all too well the pain of becoming a steer. He owns shares of Google, a Motley Fool Rule Breakers recommendation. Wal-Mart is a Motley Fool Inside Value pick. The Fool's disclosure policy wears a large cap to avoid sunburn.

Read/Post Comments (42) | Recommend This Article (206)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On January 08, 2009, at 5:06 PM, jozie28 wrote:

    So do DDS and KKD have stable cash flows now..and what about near future??

  • Report this Comment On January 08, 2009, at 6:00 PM, somacho wrote:


  • Report this Comment On January 08, 2009, at 6:50 PM, Usnzth wrote:

    Dear somacho,

    Please take responsibility for your own choices and decisions. You chose to listen to the MF recommendations. You chose to buy the stocks. You lost the money.

    Typing in ALL CAPS will not shift the blame.

    Wishing all the best for the future.

  • Report this Comment On January 08, 2009, at 8:24 PM, halrow wrote:

    Looking for great 09 investments i found is easy.

    look for great earnings ,a great dividend and a

    share buy back agreement ....such a company is PRGN Paragon Shipping Inc...earnings up 233% and gives a dividend Feb 27 09 of .50 cents per share

    yet they will also buy bck 20 million worth of

    common shares to retire them.....this is great for long term share holders.....The Baltic Dry Index is full of Sea Shipping ompanies like Paragon Shipping that give huge percent dividends and enjoy big earnins... you can find all the info on

    Look for BULK SHIPPERS thanks

  • Report this Comment On January 09, 2009, at 1:17 PM, stlucie wrote:

    Another great shipping company is Diana shipping

    (dsx) Has taken a hit like the rest but is on the rebound.

    Pays a great dividend

  • Report this Comment On January 09, 2009, at 3:53 PM, kpmom wrote:

    How do you know MCD and Wal-Mart are at "great prices"? If you didn't call the 2008 meltdown, why are you now qualified to call a bottom??

  • Report this Comment On January 09, 2009, at 6:21 PM, VaTechCrab wrote:

    I think the first step if over 70 1/2 is to roll all of your IRA stocks into a Roth IRA and pay the ordinary income taxes while the stock values are low.

  • Report this Comment On January 09, 2009, at 7:28 PM, johngerena wrote:

    Forget mortgage back secruties. There is a company called World Bankcard Solutons Inc. That is a Great investment. This Company buys future Credit Card reciepts from companies that need money and makes a GREAT ROI. In this time that small business need capital and the banks aren't lending this company is give small business cash advacne against future credit card recievables and is making a killing. They are all so recruting representatives like crazy while everybody is layoff. What A Company!

  • Report this Comment On January 09, 2009, at 8:36 PM, 181736065 wrote:

    Well, I don't blame "somacho" for being upset. TMF is advising people to buy. buy, buy and hold. but they have ruined many peoples financial lives over the last year.

    Usnth, Don't be so hard on "somacho". Perhaps he/she is not as blessedly optimistic as you or TMF.

    The problem is, for "somacho" it is a tragedy. And , just like you entertain optimistic people here, you should listen to the ones who have been ruined.

  • Report this Comment On January 09, 2009, at 9:07 PM, dolphus wrote:

    MF and other advisory newsletters I have subscribed to seem to concentrate on stock picking, and ignore the analysis of overall market conditions. Is this why these newsletters, including MF, were unable to foresee and call the worst stock market decline in the last 77 years? If so, shouldn't these advisory services, including MF, invest at least one half of their resources to gathering and analyzing the indices that are predictive of the big picture for stocks? This is possible for a large company with a large staff and access to all the data, but virtually impossible for the individual investor. As a subscriber, I expect not only individual stock recommendations for a fair-weather market, but predictions for market conditions overall. Subscribing to MF hasn't worked for me, due to the losses I've taken from following MF Income Investor "buy and hold" recommendations. Give the market analysis idea some serious thought, will you?


    "74 and hurting"

  • Report this Comment On January 09, 2009, at 9:39 PM, nietschele wrote:

    I agree with much of what dolphus says. The reason we subscribe to TMF is for guidance and education, and while the individual investor makes the final call, we are very influenced by TMF recommendations, so I believe the blame is to be shared.

    Moreover , there are no recommended safeguards like the suggestion that if you have a large paper profit, take a portion of real profit, and perhaps set a mental note to take more should the price drop to a certain level. Buy and hold did not work in this market -- maybe some common sense would have.

    I see no point in riding a stock up and then riding it down again.

  • Report this Comment On January 09, 2009, at 9:44 PM, qberry wrote:

    Good grief you all are killing me....... If you are a "trader" and not an investor than you picked the wrong service to subscribe to. Those of you that take the appropriate time frame for "investing" the way MF suggests will be rewarded handsomely. Give things another 12-18 months and many of you will be eating crow. Keep at it MF team. These are tough times and we will get thru this. Thanks for keeping us informed !!

  • Report this Comment On January 10, 2009, at 12:37 AM, Rone222 wrote:

    I am new at investing and think that MF should not only pick stocks but suggest sell target highs and lows. I like their picks on Doby and Netflix, and have seen nice profits on these stocks, but need advise on when to sell them.

  • Report this Comment On January 10, 2009, at 1:02 AM, snookdog wrote:

    Wow. I am shocked at the reliance and expectations most of you have on someone's newsletter to tell you what stocks to pick, when you should sell, forecast meltdowns that very, very few people forecasted, when to get out of the market and when to get in. I wish I had played it differently in the last 6 months but I have no one to blame but me, the sub-prime participates (what did they think would happen?), and the government for pushing home building and loans so hard that the only market left was sub-prime. Subscribe to the newsletters for points of view - but make your own decisions based on risk and timeframes and live with them . Otherwise, follow MF's advice and go into an index fund if you have the time and risk tolerance to be in the market at all. If you are 74 and have 8 figures invested in the market, then you are just being greedy and irresponsible. I'm sorry, but it's true.

  • Report this Comment On January 10, 2009, at 1:11 AM, rwk2008 wrote:

    Let's not get carried away. Somacho said he(she?) had an 8 figure retirement. If it lost 75% of its market price, he/she still has at least $25 Million. I could retire on that, couldn't you?

    More seriously, TMF, like most stock pickers, tries to choose which stocks will outperform their peers. Doesn't attempt to forecast the economy. That's left to economists, many of whom have been warning about the housing bubble and its impending burst for some time. If you only listen to your stock-picker, you somewhat deserve your results, much like the clients of dear Bernie Madoff (with their money).

  • Report this Comment On January 10, 2009, at 3:20 AM, knight2255 wrote:

    rwk is confused about 8 figure,somacho could be left with only 2.5 millions with 75% loss.

  • Report this Comment On January 10, 2009, at 3:53 AM, PoundMutt wrote:

    Well, Somacho, ten figure portfolio, eh!!!

    Let's see: $10,000,000 in an annuity paying 5% is $500,000 per year! I could live on that comfortably and that's where MY $10 mil would be, in an annuity, NOT in the stock market! OH, I forgot, you are SO MACHO!

    My mutual funds are down only about 40-45%, how did YOU manage to lose 75???!!!

  • Report this Comment On January 10, 2009, at 8:36 AM, SAMSCREEK wrote:

    I agree with SNOOKDOG. I have read the MF

    newsletter and recommendations for a long time.

    I have never subscribed to any stock picker service

    as I like to make my own decisions. But I do find that

    the MF has some good ideas and some bad ones.

    I personnaly, think that this is going to be one of the

    best buying opportunities to come along in my life time. I'm 62 and have been (I hope) bottom fishing

    a little here and there. I believe that doing your homework on stocks is essential and will help

    eliminate a lot of bad choices. The stocks that I have

    bought, are in the plus collum so far. If the market does pull them down, in the long run, I will make

    a profit.

    I only buy stocks that pay dividends

    I will continue to read the MF newsletter, to get

    their ideas.

    For what ever it's worth, check out PSEC, CODI,

    CIT, DOW, CBL, HRL and IR for buy and hold,


    Good luck to all....

  • Report this Comment On January 10, 2009, at 10:26 AM, lovetocamp2 wrote:

    I can't beleive with all the knowledge we have that people lost 50-75% of their money. I have to think they are people acting on emotions. I lost about 27% at the lowest and it has recovered some of that already. I have less than a dozen stocks because I've learned over the years that the people at American Funds are much smarter than me so I keep about 60% there, some bonds, a couple of fixed annuities and some cds. I went through my first recession in the 70's and it didn't take me long to learn not to be greedy and I am ok in any market. Sure I would rather not have lost anything in 08 but If you lose 50% you need a 100% return to get back to where you were.

  • Report this Comment On January 10, 2009, at 10:28 AM, snakeflake wrote:

    Actually Family Dollar Stores and Dollar Tree are Kicking walmart glutes! Don't expect that to be the case for the long term, but while people are cutting back, these two are rising to the top. WHen people start spending on more than necesseties, they will drop and more chic stores will make a come back.

  • Report this Comment On January 10, 2009, at 10:47 AM, celumley wrote:

    very good article

  • Report this Comment On January 10, 2009, at 11:08 AM, bjt3 wrote:

    4 picks that will make you lots of money in 2009 / 2010 under Obama and his works program. Caterpillar , John Deere & Company , Industrial Select Sector SPDR & Jacobs Engineering Group . Folks , look at the price these can be gotten at even now. I got in all 4 on November 20th, 2008 which I believe to be one of the best ever buy days for the future. These are great solid companies at a mere fraction of what they will be trading at one year from now.

  • Report this Comment On January 10, 2009, at 11:53 AM, bbeerme wrote:

    I think bjt3 is overly optimistic.

    These are still times where capital preservation is more important that capital appreciation. If you've lost 50% (or whatever) in a particular stock, it's a bit late to begin managing risk. And if you still own it, you must really believe in it, so there really is only one thing to do (regarding risk management).

    Put in a stop at 8 to 10% below current price, maybe 4 or 5% after yesterdays drop. Then, since you really believe in it, buy back the same number of shares after it drops a bit more. Then put in a trailing stop, or actively manage the stops to mimic a trailing stop. It is senseless to continue to ride it down. Yes, you will have to pay 15% on any amount considered a capital gain, but in reality that is only 1.5% if you sell after it goes up 10%. But that is all part of a risk management plan.

    It has been said that it is more important to know when to get out than it is to know when to get into an equity. And those decisions should be made BEFORE you get in, not after it is too late.

    Personally, I have given up on owning individual stocks for at least another six months to a year, after that time I will re-evaluate the market. The potential for loss is too great. I don't need to get into those details.

    The simplest way to make money in the market is to follow the trend. And we are still in a bear market, so expect to loose money if you are buying long. All I deal with now is ETF's. Pick a sector, look at the trend, and put your money on the table. Since it is a bear market, buy inverse funds (often called bear market funds). Inverse funds go up when the market goes down. No options or shorting to deal with. All I currently own is inverse leveraged ETF's.

    If you want some leverage, there are funds that move at 200% an underlying index or sector.

    There is an incredible choice of ETF's available. Look into them if you want to do well in this market. Expect another drop in the market when earnings reports start coming come out in a few weeks, then again three months after that.

    The choice is yours, fight the trend, or go with it. The info MF provides can still be used in your decision making arsenal, even if you don't like their individual picks.

  • Report this Comment On January 10, 2009, at 12:37 PM, oversea wrote:

    As usual everything must be taken with a pinch of salt. In my opinion MF's suggestions are food for thought. They give some ideas, but I'm not enough Fool to follow them slavishly since some of their suggestions look to me utterly fool (and at times they turn out as such).

    Being quite new to the American market and I've learned quite a lot form this site.

    About the fact that you have to pay for some of their reports, well nobody does nothing for nothing. As a matter of facts I buy a financial magazine too. And yes, I bought one of their reports. Interesting. I passed it over to a friend.

    A final word, don't you think that the folks at the banks would give you better advice, they get it wrong 12 times out of 10... And I speak by experience... alas.

  • Report this Comment On January 10, 2009, at 2:04 PM, Dadw5boys wrote:

    I invest with my stomach not my head. How much trash can I stomach today. This group of thugs running the market today should be tarred n feather and dumped off a bridge.

    I know I am only going to recover the losses of the 401k and the 403 if I do it myself.

    I look at investing now like riding a bucking horse. I have to time my buys when he goes down.

    I see shorts driving the price down to force people out just before the stocks runs to new highs that will keep the suckers comming back hopeing they will catch the next big wave.

  • Report this Comment On January 10, 2009, at 2:46 PM, Davelaw12 wrote:

    Guys It was dumb idea to stay in a falling (bearish market) conditions.

    Invest only in fixed income , annuities , gold mining (low cost miners) royalty trust (royal gold).

    Market will rebound sell stocks you plan on holding for long term and stay out as the downtrend continues.

    Few companies that do well are best bet but get ready to sell when they begin to fall down again.

  • Report this Comment On January 10, 2009, at 3:00 PM, SraMacaco wrote:

    I am grateful for the voices of reason that reflect my own views (SAMSCREEK, rwk2008, snookdog, qberry, etc.). I am a simple investor with most of my money in well-diversified Vanguard mutual funds, but I started dabbling in a few individual stocks to add excitement to my life.

    Everything I have lost money, but I am scrambling to come up with the cash to buy, buy, buy! I am not afraid, nor do I consider myself greedy, but I am grateful for the fear and greed in others that has resulted in this buying opportunity. Aren't our losses only locked in when we sell? If we were going to need that money within the next five years, shouldn't it have been moved to a safe haven?

    I use MF for ideas, but I don't buy everything they recommend. Even if I had the money to do so, I have to review my own needs. Does a recommendation duplicate holdings I already have in a mutual fund? Am I comfortable buying a construction company when I believe that housing is going to tank?

    Anyway, thanks, guys, for the words of wisdom. I learn a lot from you all.

  • Report this Comment On January 10, 2009, at 5:10 PM, rbgibbons wrote:

    FWIW, I did predict the bust.

    I also said back then that I thought the way to profit was to wait for the depths of the market and then buy. So, now I'm buying.

    That said, I have no idea when things will actually bounce back. Who knows, maybe things will get worse. But, I think there are some really cheap stocks right now, so that's why I'm buying.

    Richard (author)

  • Report this Comment On January 10, 2009, at 5:31 PM, synersoft wrote:

    Has anyone addressed TMF's performance relative to the market in 2008? Stop blaming the market for TMF's (and some of your) performance. As a Stock Advisor subscriber for several tears, I've sensed a huge Gardner Brain Drain as they seemed too focus on expending the revenue model a whole lot more than on the SA picks which bare/bear the brother's names. Are they are putting their future ahead of ours? Wake up??

  • Report this Comment On January 11, 2009, at 2:52 PM, dmdsgf wrote:

    It does look like MF did more than just suggest specific stocks in the article that stimulated this discussion. A recommendation was made to look at a specific equity asset class - large growth stocks that in general tend to be value stocks now. Their reasons were explained. Take their recommedations into consideration but don't follow them blindly. MF did mention some stock names - but that's all it was - a mention. You need to educate yourself if you have money in the stock market. It's up to the individual investor to come up with his or her own diciplined method to evaluate a stock (a company.) Then once that method is applied to a MF suggested stock, an informed and prudent decision can be made. Many methods are available for the common investor to use. It is usually a combination of methods that the investor feels comfortable and confident in using. For example, stock screens (available on many web sites), analyst’s reports, insider trading reports, technical analysis, consideration of current events or news regarding the stock, newsletters, stock market conditions, sector factors, new “pipelines” for the products or many other methods.

    Like Usnzth wrote, be responsible in making your decisions. Blindly following any one entitie's advise is not a good method. It's your money and no one is going to look after "yours truly" with the same interest as "yours truly."

  • Report this Comment On January 11, 2009, at 5:03 PM, SraMacaco wrote:


  • Report this Comment On January 11, 2009, at 6:38 PM, changeagent1 wrote:

    The challenge is what I enjoy. I play options, ETF's, and under $10 stocks. Oct 19th, 1987 taught me to sell early. I never buy and hold. I check volume upticks to find low price stocks, and follow with a mental stop loss. Got a triple out of DNDN in 2008. If I had held I would still be even. I also doubled my money on AKAM and ENG. Options on RMBS, SNDK, NTRI have provided me with some nice gains in the past. I bought options on AKAM, EMC, AMAT and low priced oils, metals and gold in November when they were under $10. With 30 to 50% gains I don't intend to hold for long. When they are up 50% I follow them close every day for a time to sell. TMF provides some good leeds for me. I believe we have been in a BEAR market since 1999 and the SP500 will fall under 500 sometime in the next 4 years. Check out Tobin's Q Ratio for BEAR facts.

  • Report this Comment On January 11, 2009, at 11:13 PM, trenton1ryan wrote:

    The only stocks worth buying right now are dividend paying stocks. And for your wallet's sake, don't buy all at once. I think it's better than 50/50 that we go lower before going higher. That means you'll get a chance to buy even lower, but since no one knows for sure, you buy in increments to hedge your bets.

    Inflation will return, so that should tell you a lot about places to put your $.


  • Report this Comment On January 12, 2009, at 7:46 AM, bjt3 wrote:

    So maybe as some have suggested, I'm a bit optimistic, that doesn't mean I'm wrong. I got lucky last year as my broker told me to get out and play the wait & see game. In short he didn't like the price flucuation of oil & gas. I gave him a very nice Christmas present!!

    When you read all the articles on the future everybody tells you gold. This is because analysts predict that the Fed will continue to cut interest rates which in turn will likely fuel greater numbers of investors seeking ways to diversify out of the dollar.

    However the price of gold essentially has a built-in “peak.” When the price per ounce rises the higher prices make it easier to fund further mining efforts and the supplies consequently increase. Gold becomes expensive to purchase for jewelry-making purposes, so fewer jewelers buy it. More individual jewelry owners opt to sell their jewelry for its gold content. In short, higher prices mean that the market gets flooded and, in turn, the prices go down again.

    So we will see if some major works projects bring up the economy, as it has in the past or if I'm being optomistic.

  • Report this Comment On January 13, 2009, at 5:13 AM, matcha695 wrote:

    TMF has taught me the key to making lots of money: convince other people to pay you money to advise them how to make lots of money. i.e. If you can't pick the stocks well enough to get rich then convince others to pay you for your opinion on what stocks they should buy. Strange world!

  • Report this Comment On January 13, 2009, at 8:54 AM, ttboydxb wrote:

    I think it's funny when people want TMF to share the blame for money THEY'VE lost, when all I have read so far from TMF is NOT to invest $ that I am going to need for the next 5 years. I am a beginner (last Sept), as of today I am down 14%, but have been nibbling away every month, getting more and more stocks of companies I have RESEARCHED. If the market drops for the next 3-5 years, so be it, I will continue to dollar-cost average, I'm just making sure the companies I am buying are paying me a dividend to be a on their team.

    And when there eventually is a rebound, which I believe there will be sooner or later, I think everyone who hasn't bought into this selling panic will be smiling pretty. I wondered about people at work who would brag about buying a stock the day after it went up by 50%. I rather be the one who had owned it before the increase. But that's just me. Be patient everyone, have a LONG TERM horizon, and you'll be just fine, actually better then fine. And if you're not planning on being on this earth in the next 5 years, what the hell are you doing in the stock market??

  • Report this Comment On January 14, 2009, at 10:50 AM, bothisellhigher wrote:

    As a long time chartist, but brand new to MF (which I feel is a terrific place to get ideas to 5 star rec's or articles like this)...let me add my 2ce nts worth...MCD, having just broken support of 60 is more likely to retrace to the 52-53 area than it is to go up...and WMT needs to break above 59 for it to look good...and if it penetrates 48.20, it's probability is you long termers hold off just now...

    As for GOOG, too rich for my investment budget, but Mr. 8 figures (bless you) can look at it above $321.45...and lastly...I have found the optimisitic life view to work far better than the pessimistic for bjt3, keep on keeping on!

  • Report this Comment On January 14, 2009, at 11:14 AM, davidkubica1 wrote:

    Most people when you ask them about investments will simply focus on the big 3: stocks, bonds, and cash. It is because this is all they know. I would recommend looking into researching managed futures if you would like to better diversify.

    If you are interested in managed futures, you can try They usually have some pretty good programs that they offer. This one: had a return in 2008 of over 128% and has averaged a monthly return of over 8% since its inception 5 years ago. The nice thing about these performance sheets is that you know they are authentic. Managed futures returns are regulated vigorously by the CFTC and are all stated NET OF EXPENSES.

  • Report this Comment On January 15, 2009, at 6:42 PM, DarthVater wrote:

    Someone is calling a bottom, that's interesting. I stay with the fcst of John Mauldin predicting another 30-40% meltdown after the summer.

    This reminds me of how our physics teacher explained the size of the universe: "it is not just infinitely bigger than you imagine - it is bigger then you will ever be able to imagine". It is the same with this downturn. It will not just be much worse than you expect but also much worse than you will ever be able to expect.

    We have been going into the wrong direction for 35 years since the Bretton Woods agreement phased out in 73 and that will most likely not be corrected in 35 weeks....

    I have been on the sidelines since April 2008 (I always sell all my stock holdings April 30 each year) and I will say there until Thanksgiving 2009.

  • Report this Comment On January 16, 2009, at 2:02 PM, arcnev wrote:


    I hope you didn't buy this (DSX) resently expecting the dividend after November. The dividend was nice but has been suspended until further notice.

    The reason given was that DSX expects some of their competition to go under and they want the $$$ on hand to buy some of their ships.

    I hope they do re-instate the dividend cause my 500 shares are getting lonely.

  • Report this Comment On January 16, 2009, at 2:21 PM, hopeon2000 wrote:

    Many times have i also heard the arguments made hear especially when loosing many is the heart of the matter. I learned that we as investors or traders have to do our own homework no matter what. We must understand our actions when we trade in the market. We must fully understand this, it is what matters. In my readings i understand that all people who make (or loose) money had their conviction and stuck too it. IF things changed they changed or reassessed their positions. A mistake is to take wall street for face value, I use this mantra... - would I lend joe blow on the street 100's, or 1000' s without checking things out. DUE Diligence is our responsibility if we are the ones choosing to invest. We must again understand and understand fully those investments. IF you or I cant find out or dont have the answer then dont invest.

  • Report this Comment On January 16, 2009, at 11:11 PM, dameron123 wrote:

    I am not a TMF subscriber and the reason is simple. TMF does not have privileged access to privileged information. Anything they can come up with is already "out there" and therefore it has no intrinsic value to me. I want to tell you what I did and how I did it. First let me explain that I am "world and business news junkie" and for the last 8 or so years there were a few little statistics leading up to December 2007 that increasingly weighed on me.

    They were:

    1. Ever increasing worker productivity.

    2. No sustained decrease in the unemployment figures (out of the last 31 quarters only a handful showed a modest decrease).

    3. No appreciable increase in wages above and beyond inflation.

    4. The incredible and unsustainable increases in housing equity.

    5. The incredible mountain of debt Americans took out based on this hyper rise in housing equity.

    6. Companies fleeing the U.S. workforce for cheap labor overseas.

    7. When you x-out home equity, 80 to 85% of Americans are broke and in debt over their heads.

    Now these stats came from being an "observer" if you will. It culminated in December 2007 when I coined (I think) a term "the phony economy". It led me to pull out of the stock market in one day in January 2008 100% for the first time ever in 36 years of investing. I stayed 100% cash the whole following year and am just now beginning to dabble back in. I do not subscribe to any newsletters because it occurs to me that if I knew what letters like TMF claim they know I would be too busy investing and managing my billions to be bothered with trying to convince you that you should pay me for a newsletter. Now I see from preceding comments that some expect even more from the likes of a TMF like a broad market/economic overview thinking, I guess, with that information they would have predicted the collapse and that is just not realistic. There was not one person that I am aware of that has a major media outlet that was doing that. I consider myself to be really lucky to have been vigilant enough and thoughtful enough on my own to realize that all was not what it seemed. If you need people like TMF to tell you what, when, where, how, and why with investing my best suggestion to you is to stay in 30 year bonds. That is all I have to say about

    newsletters and their implications for the subscriber. I wrote a piece on for a friend who calls herself zrants called "The Perfect Storm". It arose out of a series of e-mails between me and a few friends, one in particular, over many months, about why I was voting for Barack OBama. I would send the on-going discussions to all my contacts. One day one in particular responded with "interesting story may I publish it and give you credit?" I responded that she could after she explained to me why it read like a story. Her wordpress user-name is zrants. I don't think it will tell you much more than I wrote here but you can search for it there if you wish. For all who read this I wish you all the best in 2009!

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