You should have sold your stock a year ago

Reuters:

Stocks plummeted for a seventh straight session on Thursday as investors bet recent moves by authorities worldwide to thaw frozen credit markets would not be enough to avert a global recession.

An avalanche of selling at the close left the Dow below 8,600 for the first time since May 2003, and down almost 40 percent from its all-time closing high hit exactly one year ago. The Nasdaq and the S&P 500 each also fell to levels not seen in more than five years.

Bank and insurance stocks got hammered again, as the previous day's coordinated global interest-rate cuts and myriad other official actions to unfreeze money markets did little to boost confidence in the financial sector. Some traders said the lifting of the ban on bets that financial stocks will drop may have contributed to the sell-off.

Credit markets remained clogged. The interbank cost of borrowing dollars for any period beyond overnight rocketed -- three-month dollar Libor hit its highest this year.

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If you had sold you stock a year ago today and bought acreage in Washington County Texas the appreciation in the land would actually be greater than the loss you avoided in the market. Land values here have gone up 42 percent or more despite falling real estate prices elsewhere.

The fact is that trying to pick the top or bottom of a market is about like trying to catch a falling knife with your bare hands. Since most bear markets usually fall roughly 30 percent from the high and we are already beyond that, we should be closer to the bottom at this point, but the psychology has yet to turn around. There are probably some bargains out there at this point and people like Warren Buffet and the vulture fund guys are already buying. They are looking for quality companies with good long term potential. It is probably not a time to be betting on growth stocks.