Sunday, September 25, 2005

Sunday Stew: Show the Bears the Exit, Please

As history shows, September is typically a very volatile month for the stock market.

So the CNBC induced cacaphony and whipsaw action we've witnessed thus far doesn't "shock" us, for lack of a better word.

We are expecting a strong Fall rally.

There are too many depressed stocks out there.

Pfizer, Microsoft, Heinz.

C'mon -- give these companies a break.

Any analyst worth his salt will tell you that all three of the aforementioned stocks are trading below value.

Heinz for example.

Barron's rightfully pointed out over the weekend that the ketchup king deserves a higher multiple, considering how shareholder-centric the company is.

The more negative news we see in the media, the more stocks we load up on.

Stocks are susceptible to a host of factors, two of which are real world events and news.

Stepping into the marketplace after an exogenous shock presents a window of opportunity no smart investor should ever miss.

That's because pricing inefficiencies are rife whenever investors sell stocks based on something they read in the morning headlines without showing the least bit of concern for the businesses their stock certificates represent.

With both Rita and the Fed finally out of the picture, the mental fog that's beset downtown Manhattan should clear up.

Expect a short term bear market rally.

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