Friday, September 26, 2008

Where do investors and savers go when the economy turns unstable?

A couple of weeks ago I’ve read and opinion written in my Country that explained that due to uncertainty peoples’ preference was moving into the acquisition of perdurable goods such as properties, cars, etc.

I don’t agree with this, I still think that one of the most secure points to put your money under a big storm like the actual one is the Stock Market, I believe that – and of course it depends on when you need your money back in cash – if your goal is not to lose money or its value, you have time to wait – lets talk at least about the medium term – the best point is to buy shares of well-known companies.

You can predict that those companies won’t disappear over time (in particular the ones that are dedicated to the production of goods) and that their value will be recovered over time. Their fluctuation will be according to the ones of the economy and when this one turns over so will do the shares' values.

Even in the big collapse that well-known banks are suffering right now they inform that the shareholders’ funds are safe. If this is true, only the time will give the answer…

To conclude, for me shares are still the best “captain to manage a big storm

See you on my next post!

Prof. Lic. Fernando Julio Silva, MSc.
SEPTEMBER 2008

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