THOUGHT FOR MONDAY 14TH JANUARY 2008
From top share author MALCOLM STACEY
Hello Crazy Cats,
Let's hope for a better week. I estimated in November that shares would fall in January - because they nearly always do.
But will they keep on falling? A load of people seem to think so. They cite the credit crunch for this view. But in my humble experience, the unexpected happens in Crazyland more often than the expected.
After all, if everyone was right in their fears and hopes all the time, the market would already be reflecting that. And as most folk expect, or say they expect (which is not quite the same thing) shares to decay, then you'd think another 1,000 points would already have been pruned from the Footsie.
What is actually happening, methinks, gang, is that the big traders are rather frightened to sell loads of stock in case sentiment changes for the better. There is awful pain in selling stocks only to see them rise very soon afterwards.
This pain is increased if everyone around you did not sell. So, although the experts like to cover their reputations, by announcing their fear of a US-lead recession, some could be holding back on big selling, in case they are wrong.
Yes, the credit crunch threat is a worry. But the financial world is very good at recovering from mistakes, and now the danger has been well aired, well maybe the mini crisis will recede. Maybe not in the next few months, but will we worry about it in two years' time? This old punter doubts it.
There are some very short memories in Crazyland. And there's obviously a strong will out there for shares to do well. So eventually they motor up nicely - as history so often shows. Rocking on!
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