Hello my compatriots,
May I get back to the original discussion, namely the "butter knife panic" experienced by wallygator69?
In 2000, I stayed away from bogus companies with no earnings, and bought "real" tech companies (semiconductors, telecoms) etc..., which I later found to be overpriced compared to historical values, though a lot "cheaper" than the dotcoms.
Thanks to that, plus the keeping of 30% in cash reserve, my portfolio only lost 50% of its value, as measured from the top in March2000 to the bottom in Oct 2002.
But I hung on and did not sell out at the bottom. As mentioned, I still had cash, but was too afraid to buy more. Still, perseverance paid off, and I now have 33% more than my top in 2000, despite already losing 12% since Oct 2007.
Having survived that, I try to do better this time. Though I am never fully invested (too chicken and always want some cash handy) and always keep 33% in MM, I have just sold enough yesterday to raise the cash to 50%.
Call me a market timer if you will, but with this cash I am going to sit it out, and will not be losing sleep. At some point, I may be buying back, but just do not know when. In the long run, I may not beat the buy-and-hold investor, but I admit that I do not want to have to entertain the "butter knife" solution
Just my 2 cents.