Ben Carlson: What Would You Have Done In 2009?

Ted

FYI: A reader asks:

What would you have advised me to do in 2009? I wanted to put $XX [Ben’s note: a lot of money] in the total stock market and ride the index. I had around $XX [Ben’s note: about one-third as much as the amount in cash] in VTSMX at that time. I had been waiting for a blood in the streets event and was licking my lips. I read every book on 1929 and I figured it went down 89% and that if I enter at 50% of the 2007 high I might be ok. I picked 6300 as a starting point. I remembered reading about the dead cat bounce in 1929 before a further fall to 89%. As you know it never fell back and I never got invested.

This is tough to answer because we now have the benefit of hindsight. But this reader is not alone sitting in cash waiting to deploy in the stock market at lower levels following the crisis.

It’s also tough because no two crashes are ever the same.
Regards,
Ted

jerry

I purchased stocks in june of that year . Not so much because of the level but because it seemed clear the world was not coming to an end