Nervous about a stock slide? Cut your risks - The Detroit News
I’m talking about the angst you may have felt just a few weeks ago, as the news was full of problems in Greece and China and the stock market was plunging. If you were like many people, you worried about a stock market meltdown — one you couldn’t bear if it ended up like the one that ravaged 401(k)s, IRAs and college savings amid the recession and financial crisis of 2008. With emotions still raw... In notes to clients, they promised that Greece wouldn’t hurt investors because it was a small country, and China was going to keep growing fast despite the plunging stock market. They underestimated the mess Greece could transmit to Europe and banks if financial problems snowballed to other countries. Furthermore, the assurances on China seemed to flow way too easily from financial advisers a long, long distance from China’s economy. China’s government is secretive about the state of the economy, and even analysts who have spent a lot of time there come away without clarity about the world’s second-largest economy. So do you relax now, or dump all your stocks because problems could arise again. But that’s not because of the outcome of Greece or China. It’s because you were sailing along feeling fine until early July, and then all of a sudden news on Greece and China made you feel queasy. Those incidents demonstrate that nasty surprises can surface suddenly for the stock market. Source: www.detroitnews.com
