LABJ FORUM - Getting Back Into the Water
The stock market appears to be showing signs of a rebound as global conditions inch towards more stability than has been seen in months. However, not everyone is convinced that the market is ready to shed its bearish ways just yet, and many believe caution is the order of the day. So the Business Journal asks:
Are you going to play the market or play it safe?
Walter N. Torous
Director, Center for Real Estate
The Anderson School at UCLA
I'm not investing right now in the stock market. There's still a lot of uncertainty. Global conditions are not stable, and there's also the economy. I think it's prudent to hold off right now.
In my personal portfolio, I try to invest over the long term, so I avoid chasing momentum when prices are going crazy on the upside without soundness in the fundamentals of the companies. The same thing goes on the down side. I try to avoid what I see as emotionally driven responses to external forces, like the events immediately following 9/11, that influence the market.
Vice President and Chief Operating Officer
Independent Capital Management Inc.
What I would do for myself is different from what I would do for my clients because I have a different risk tolerance. A lot of people now wouldn't invest in the market even if we recommend it to them. There's a lot of fear. They'd much rather earn nothing than lose money at this point. Our typical client earns $60,000 a year and has a family. We are recommending that our clients get back in the market sooner rather than later, albeit in conservative stocks rather than high risks. When the market was really high, people were calling us with the most ridiculous schemes. But with the environment today, people are loath to take risk, so there's a lot of cash stored up.
President and Chief Executive
San Gabriel Valley Economic Partnership
I'm bullish. I think we've seen the end of the bear market. I think the bulls are back and I expect to see continuing, ongoing improvement in stocks. Plus, if we continue to see some good earnings reports, as we've seen in the past few weeks, it bodes well. And if the Fed cuts again next month, things will continue moving in that direction.
I am definitely investing right now because stocks are so cheap. I don't think you can beat the deals you can get these days. And as someone just coming out of college, it's money that I can put away and see how I can increase it. I'm a gambler by nature so I'm not too worried. I don't think the market can get any worse than it has been.
Clearstone Venture Partners
I think you'll see the amount of venture capital in Southern California is going to be growing. There are offers flying everywhere for venture capitalists offering to invest in companies. There's a lot of activity. Personally, I'm a long-term holder. The worst thing you can do is sell in a depressed market. I'm also a long-term believer in information technology, and I think we're still in the first inning there. In all the sectors around data storage and security, there's lot of neat things happening with products that a lot of corporations are going to buy.
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