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Are you getting nervous about stocks?

Peter Switzer

Are you getting nervous about stocks given the big rise in the market this year and with the US Federal Reserve likely to start tapering back on its big QE3 program or bond-buying? Is it time to get out?

I wouldn’t be surprised if stocks had a few dips over September and October as these are the spookiest months of the year for markets. And yes taper talk at the September 17 Fed meeting could spark a sell-off of stocks, but I do not think they will be dumped too heavily. Also I think a sell-off will bring out bargain hunters who will help cushion the fall and will eventually stimulate the US market going higher. Locally I think the election being over, a lower dollar and lower interest rates will mean our stock market will power along, even with some dips, and so I remain positive on stocks. The legendary investor, Sir John Templeton once explained “Bull-markets are born on pessimism, grow on skepticism, mature on optimism and die on euphoria.”

We’re in a bull market and we’re out of the pessimism stage but only into the skepticism period, so this bull run has a way to go. So I am buying great companies on the dips!

Published on: Friday, August 16, 2013

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