You always hear me talk about opportunities and the road ahead, well the time is now. BUY, BUY, BUY.
We discussed cash is king in a recession and the impact that consumer spending has on the recession. We also discussed the opportunities that arise in a recession. It’s like a giant red tag sale except you can’t pay with your credit card. This has been a long and crazy recession and the housing market boom was to blame. The great news is that it might be over soon, the bad news is after a recession, comes inflation. We learned about inflation and the problems that occur because of it, but what does inflation mean to financial opportunities?
Risk is a big factor when opportunities arise in the middle of an inflationary period but rewarding can they be if calculated properly. What we know about inflation is its impact on the pricing index, and its history of driving the index way up in a very short period of time. Getting into calculated stocks that are at their rock bottom could make you rich quickly. This is a once in a lifetime opportunity s we recover from the worst economic downturn since the great depression to recover most of your losses. Invest in the stocks that have survived so far and will now make a turn around and see recovery.
Some great opportunities that carried a risk were banking stocks like CITI, Bank of America, Wells Fargo and VISA. All great stocks but under performing at very low prices. Other stocks include giants in the retail/electronics field like Apple. Apple has done very well with their iPhone and continues to do well despite consumer spending coming down, and will make a great recovery in mid 2010.
There are other many stocks out there that also reflect major late losses but look promising on a 6-12 months horizon. The key is to make sure you stay away from mergers and companies that could fold overnight.
The other plan to have prior to the end of the recession would be to know what some big ticket items you have been looking for are, and make your move. With the recession ending and the prices of inflation waiting right behind it, comes the problem of supply and demand which means that others will start moving in on cars, houses, electronics that have been on sale and have also hit rock bottom. This is the time to start picking up those items as this winter might be the last for you to get on the 60% off car prices.
So act fast and remember, without risk comes no reward.