how to buy stocks online | BE CAREFUL BEFORE BUYING INTO THIS STOCK MARKET

Last year (2009) was a great year for anyone who got involved with the market and was buying stocks for the first time. After the beginning of February, it was almost straight up for the rest of the year and you probably did very well with most any stock you bought.

2010 though, could be a much different year for stocks and it is already starting out like that. In 2009, we had a brand new President who preached hope and people were enthusiastic and upbeat about a change for the better. The market no doubt was helped along somewhat from this positive energy as people were willing to buy back into it in hopes that the economy would start to turn around.

Now though, after one full year and an economy that just keeps getting worse, people’s perceptions of the future aren’t nearly as rosy. The Obama stimulus isn’t working and there is growing disatisfaction coming from all parts of America as well as from both liberals and conservatives. Unemployment continues to hover around 10% and companies like Toyota are in trouble for the first time in recent memory. All in all, things look extremely dicey at the moment and the stock market is showing it. 

The Dow has now dipped below 10,000 for the first time in months and investors look like they are increasingly weary of the future that seems so uncertain. If you are looking  for the best stocks to buy right now, you might keep in mind that there is nothing stopping the market from going right back down to 7,000 or even lower than where it was before it made it’s big comeback.  

Investors seem to forget the past too quickly and sometimes get swept up in the euphoria of a rising market. Having the Dow rise well above 10,000 has made stock buyers forget how bad things were just one year ago. 2010 could very well be another really bad year as the Obama administration flounders with solutions and continues to spend money like they were printing it themselves (too bad they are).

High inflation, low interest rates, high unemployment, and a further deterioration of the economy could be what we have in store for this next year and beyond. It is my opinion that anyone thinking of buying stocks should be cautious and not spend all their money at once. Of course this could be a buying opportunity but it just doesn’t feel that way to me. It feels like some more difficult times for stocks might be right around the corner so I am hanging on to my cash for now.