Da Market

Da Market is discussed a lot. I guess those two words can mean a lot of things. 

In the old days when there weren't giant super stores near our neighborhoods, we went to an outdoor market and bought things. That was before my time. Then grocery chains opened up large stores that constituted our idea of Da Market. Nowadays, groovy parts of our towns and cities have something more like the old fashioned outdoor markets. It's fun to hang out in those places and you can buy just about everything there. You can also buy fresh foods that a local farmer brought to the market that day.  Local musicians provide entertainment at some markets and you might even be entertained by a local magician. Call it community. How nice. 

When I hear the words Da Market it often brings to mind stock markets. Most of us don't physically go to a stock market. Most of us call our broker or we can make trades -- sales or purchases -- sitting on a chair in our living room typing on our Internet-connected computers. Some of us have very short-term goals. We try to buy low and then sell high. In that way we hope to make capital gains. Unfortunately, that's a tough call and might even be impossible for most of us. I seem to be very good at buying high and selling low. If only I could predict the future.

Most of us stay away from the lure of capital gains. Instead we SAVE. Saving means that we don't spend all the money we earn. What fun is that? Why not just spend it all right now? Maybe we need it for the proverbial "rainy day". Maybe we will need money after we retire. Saving helps us spend when our incomes are low. 

Saving can take on many forms. We can save money by leaving it in a bank account.  We can save by buying a bond or a stock. We could save by buying a durable good -- any good that lasts a while that we could later sell. So long as you can find a way to sell any of these items when you need some cash down the road, we can call that saving. 

That's a lot of boring background to get to the idea of Da Market. Most of us use those words to describe the stock market. Many of us are invested in the stock market and the main characteristic of the stock market is that it unpredictably goes up and down. Imagine being on a roller coaster with a blindfold on. Crazy. But another truth of the roller coaster is that if you just leave your mask on and if you wait long enough, the coaster will stop and you can get off.

The stock market is the same way. You can get bowled over by all its twists and turns or you can instead put your money in some nice stocks and go back to your knitting. Its called the "buy and hold". Put a little bit of money away each month, wait until retirement, and then take your money out. For most long periods of time, you would have been blessed by a nice gain. 

Which gets us to right now. I spent my life doing the buy and hold thing. When I retired I had a nice nest egg. But in the last couple of years I saw a lot of my money disappear. Wam bam thank you Larry. Gone. 

What to do now? Luckily I have enough income off what's left to keep me going. Luckily I understand that panicking is not good. Panic means I might look at declining values and sell my remaining stocks at ridiculously low prices. I don't want to do that! So I guess I will hold a while longer!