The Stock Market has Fallen
Yes, that is true. Everyone is frightened of the stock market right now. Yes, that is true also
Newspapers are filled with stories of stock investors getting wiped out. Yes, retirement saving plans have fallen enormously. But, all these are actually positives not negatives! It is precisely because everyone is frightened that there are few to nil buyers. So, what can a seller do? A seller has only one option: lower and lower and lower the selling price, hoping for a buyer.
Stock owners who wish to sell are struggling and hoping and praying. Such a climate is perfect for buyers.
What are rich people doing right now?
Rich people are buying stocks right now. There is little to no competition so they are sometimes the only bidder, especially if it is a thinly traded stock.
Prices are low. Benefits are huge.
When a Dividend is declared, it is denominated in dollars. When the stock price suddenly falls, the dividend stays the same -- and the percent return of that same dividend just sky-rocketed up. Here's an example. A $100 stock which offers a measly $2 dividend creates a 2% annual return for you. When the stock plummets to $40, that same $2 dividend is suddenly a 5% return.
Sellers are actually totally grateful for any bid, any bid at all. Last month, I chose a new stock broker and sent him a very large check. This is what Warren Buffett is doing too. He is taking his cash assets and converting them to equities. Right now. When everyone else is frightened.
Change your thinking. This is the exact time to buy stocks.
Raymond Aaron,New York Times Top Ten Bestselling Author, "Double Your Income Doing What You Love"
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