Posts Tagged ‘stocks’

Dear TV Network News Financial Analyst,

I am a faithful watcher of your news network and I particularly enjoy hearing your analysis of the terrible events that are happening in our business markets. Because I have complete confidence in your views I wonder if you might answer just a couple of questions I have about my 401k portfolio?

1. I have really taken your message to heart about my 401k; you know, the one where you say “buy and hold”? I think that is really good advice because the worst thing to do is to panic and sell just because everyone else is. I am now in my “hunker down” mode, and I want you to know you can count on me – I won’t sell anything for years because I trust your judgment.  Here is a list of my current stock holdings, note that I have heavily favored financial stocks because they have out-performed so well in the past:

Lehman Brothers

Indymac Bank

Washington Mutual Bank

Wachovia Bank

Bear Stearns

Merrill Lynch


Fannie Mae

Freddie Mac

To tell you the truth, with all the bad financial news these days, I’ve been afraid to look at my 401k statements for the past few months, but I am sure we can ride this out with the buy and hold strategy you keep talking about. 🙂

2.  I do have just one other question. You know how you have that chart that shows how if you invested $1000 in the DOW thirty years ago you would have about a trillion dollars now if you just stayed invested? Well, I was wondering about one thing. I know that one of my favorite stocks, AIG, had been a part of the DOW, but just recently, after it’s unfortunate, but I’m sure temporary slip, it was removed from the DOW!!!

I noticed that during the last few weeks that AIG had been a part of the DOW the DOW average had been really dropping fast, but now that AIG is no longer part of the DOW it is doing a lot better.  I was just wondering if you thought that there was any relationship between the removal of tanking stocks from the DOW and then replacing them with stocks that are doing really well has any relationship to the way the DOW has historically done so well over the last thirty years?

Thanks for you help. I really appreciate your insights.

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