Friday, January 11, 2008

In the Air with Anvil

Today: see yesterday.

Today, for the first time, since last August, I sensed a nip of fear in the air. Some of it was mine. As a man, sitting on cash, I should have been happy, but I wasn't.

I may as well confess.

This morning, I was reading Dick Arms' blog on TSC and he said an oversold rally was coming. Then I saw a guy on the Stock Channel, saying that valuations, in general, were so extremely low as to be grotesque. He said that the tsunami of all rallies could be in the offing, soon. He expressed contempt for bears. He was not Larry Kudlow.

That was all I needed to know. Like Toad with a new mania, I was off to do a trade! After the open, I let a couple of minutes go by, to let everything settle down, and then I bought a pile of SPY. Enough to make it interesting. I paid 140.65.

It fooled around for a little while, got up almost to 142, and then sank like an anvil, with me attached to it like Wile E. Coyote. I've been beating myself up about it ever since. It's not being down that induces such self-loathing, it's the stupidity of it. This was what I had said I wouldn't do. I didn't want to do it. I'm an all-or-nothing guy. But I did it anyway.

To make things worse, in the middle of the day, I heard another guy on the Stock Channel, describing every investor's worst nightmare: you think you're at the bottom of the cliff, but it's really the top of another, bigger cliff.

The best thing that happened today was that, after being down 16, GOOG came back to close down 8.

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