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The biggest fortune occurs during panic sell offs

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19 March 2008 @ 01:54 am EST
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JL: Man, what a week. I m starting to sound like a broken record here maybe insane is just the new normal. A massive Fed bailout plan, a market moonshot, and a few days later the fifth biggest house on Wall Street goes kaput. How are things looking from the Cash McDash turret?

CASH: Turbulent, my friend, turbulent. But the good news is, this is the stuff that lows are made of. In my opinion, we re very close to a tradable push higher. That means the opportunity to make a ton of money.

JL: Whoa. Are you calling for a major bottom here?

CASH: Hey now, don t pin that on me! Remember, I m just a lowly trader. I get hints and glimmers of the macro picture, but mostly I just trade my book on a day to day basis. And today, it looks like we re setting up for a decent rebound.

JL: Gotcha. So are you going off your gut feeling here, or do you have something more tangible to back it up?

CASH: Well, you re a bit of a market history buff. Take any historical bear market and tell me how things looked at the bottom.

JL: Ugly. Despondent. A sense of all hope lost.

CASH: Right. And not only that, but large institutional names failed too. There s almost an unwritten rule that someone or something major has to fail before the bears are done. We re seeing that with Bear Sterns right now, and it s putting a huge strain on our financial system. In panic mode, investors aren t just selling risky positions. They re selling whatever they can find a market for.

JL: Hmm.

CASH: The way I see it, the chance to make the biggest fortunes occur not during bull markets but during panic sell offs when everything s on sale! I can hardly keep my hands off the buy it now button!

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